Ryan Company wishes to prepare a forecasted income statement, balance sheet, and statement of cash flows for 2012. Ryan’s balance sheet and income statement for 2011 follow:
Balance Sheet 2011
Cash . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 10
Other current assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 250
Property, plant, and equipment, net . . . . . . . . . . . . . . . . . . . . . . 800
Total assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $1,060
Accounts payable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 100
Bank loans payable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 700
Total stockholders’ equity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 260
Total liabilities and stockholders’ equity . . . . . . . . . . . . . . . . . . . $1,060
Income Statement 2011
Sales . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $1,000
Cost of goods sold . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 750
Gross profit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 250
Depreciation expense . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40
Other operating expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 80
Operating profit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 130
Interest expense . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 70
Income before taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 60
Income taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
Net income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 40
In addition, Ryan has assembled the following forecasted information regarding 2012.
(a) Sales are expected to increase to $1,500.
(b) Ryan expects to become more efficient at utilizing its property, plant, and equipment in 2012. Therefore, Ryan expects that the sales increase will not require any overall increase in property, plant, and equipment. Accordingly, the year 2012 property, plant, and equipment balance is expected to be $800.
(c) Ryan’s bank has approved a new long-term loan of $200. This loan will be in addition to the existing loan payable.
(d) Ryan Company does not anticipate paying any dividends in the coming year.

Instructions:
1. Prepare a forecasted balance sheet for 2012. Clearly state what assumptions you make.
2. Prepare a forecasted income statement for 2012. Clearly state what assumptions you make.
3. Prepare a forecasted statement of cash flows for 2012. Use the indirect method of reporting cash from operating activities.