BALNCE SHEET 2006 Assumptions 2007

13 Cash 10000 1M Increase 11000

14 Accounts Receivable 21250 8.5% of Sales 27625
15 Inventory 25000 10% of sales 32500
16 Current assets 56250 71125
6 Gross fixed assets 80000 20 M Increase 100000
9 less:acumulated depriciation 20000 15M dep Increase 35000
10 Net fixed assets 60000 65000
Total Assets 116250 136125

LIABILITIES AND EQUITY 2006 Assumptions 2007

17 Accounts Payable 19500 12% of CGS 25350
22 Credit line 5000 3306.25
21 Current long-term liabilities 5000 5000
23 Current liabilities 29500 33656.25
18 Long-term debt 20000 5M Decrease 15000
20 Common stock 20200 20200
19 Retained earning 46550 20718 add in RE 67268.75
Total liabilities and equity 116250 136125
 INCOME STATEMENT 2006 Assumptions 2007
1 SALES 250000 30%Increase 325000
3 LESS: CGS 162500 211250
2 Gross profit 87500 35% of sales 113750
4 Less: Operating exp 25000 10% of sales 32500
5 Less: Interest exp 3000 10% of LTD & Credit line 2500
7 Less: Depriciation exp 10000 5M increase 15000
8 Pretax income 49500 63750
11 Less: Taxes 17325 35% tax 22312.5
12 Net Income 32175 41437.5
19 Dividend 50% of NI 20718.75
20 Income after dividend 20718.75
 Table 1 shows the financial statements of 2006. Generate a Proforma Financial Stat
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 Table 1 shows the financial statements of 2006. Generate a Proforma Financial Statements for 2007 by usin
Zinsmeister plans to increase sales by 30% in 2007
The company grossprofit margin will be remain at 35%
Operating expenses will equal 10% of sales as they did in 2006
Zinsmeister pays 10% interest on both its long debt and its credit line
Zinemeister will invest an addational $20 million in fixed asset in 2007,which will increase dep expense from $10 to
The company faces a 35% tax rate.
The company plans to increse cash holdings by $1 million in next year.
Accounts Recviebles equals 8.5 % of sales.
Inventrioes equal 10% of sales.
Account payables equal 12% of CGS.
The company will repay an addational $5 million in long term debt in 2007.
The company will payout 50% of its net income as a cash dividend
The company plan to use its credit line as the plug figure
35%.
 Service Shoe Corporation

BALNCE SHEET 2006 Assumptions 2007

13 Cash 10000 1M Increase 11000
14 A/R 21250 8.5% of Sales 27625
15 Inventory 25000 10% of sales 32500
16 Current assets 56250 71125
6 Gross fixed assets 80000 20 M Increase 100000
9 less:acumulated depriciation 20000 15M dep Increase 35000
10 Net fixed assets 60000 65000
Total Assets 116250 136125

LIABILITIES AND EQUITY 2006 Assumptions 2007

17 A/p 19500 12% of CGS 25350
22 Credit line 5000 3307
21 Current long-term liabilities 5000 5000
23 Current liabilities 29500
18 Long-term debt 20000 5M Decrease 15000
20 Common stock 20200 20200
19 Retained earning 46550 20718 add in RE 67268.75
Total liabilities and equity 116250 136125
 INCOME STATEMENT 2006 Assumptions 2007
1 SALES 250000 30%Increase 325000
3 LESS: CGS 162500 211250
2 Gross profit 87500 35% of sales 113750
4 Less: Operating exp 25000 10% of sales 32500
5 Less: Interest exp 3000 10% of LTD & Credit line 2500
7 Less: Depriciation exp 10000 5M increase 15000
8 Pretax income 49500 63750
11 Less: Taxes 17325 35% tax 22312.5
12 Net Income 32175 41437.5
19 Dividend 50% of NI 20718.75
20 Income after dividend 20718.75