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2 April, 23:17

A proposed new investment has projected sales of $750,000. Variable costs are 55 percent of sales, and fixed costs are $164,000; depreciation is $65,000. Prepare a pro forma income statement assuming a tax rate of 35 percent. What is the projected net income

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  1. 3 April, 00:10
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    Net Income 70,525

    Explanation:

    Preparation of a pro forma income statement assuming a tax rate of 35 percent and projected income

    Sales 750,000

    Less : Variable Costs (412,500)

    (55%*750,0000)

    Fixed Costs (164000)

    Depreciation (65,000)

    EBT 108,500

    Taxes 37,975

    (35%108,500)

    Net Income 70,525

    (108,500-37,975)

    Therefore the Net income is 70,525
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