Question

Your pro forma income statement shows sales of $975,000​, cost of goods sold as $503,000​, depreciation...

Your pro forma income statement shows sales of

$975,000​,

cost of goods sold as

$503,000​,

depreciation expense of

$102,000​,

and taxes of

$148,000

due to a tax rate of

40 %

What are your pro forma​ earnings? What is your pro forma free cash​ flow?

Complete the pro forma income statement​ below:  ​(Round to the nearest​ dollar.)

Sales

$

Cost of Goods Sold

$

Gross Profit

$

Depreciation

$

EBIT

$

Taxes (40%)

$

Earnings

$
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Answer:

Particulars Amount($)
Sales 975000
LESS:- Cost of goods sold -503000
Gross Profit 472000
Less:- Depreciation -102000
EBIT 370000
Taxes [40% of 370000] -148000
Earnings [ans] 222000
1]Proforma earnings = $222000
2]Proforma free cash flow = Earnings + Depreciation
324000
$324000
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