Prepare the firm’s proforma Balance sheet for 2019 using Sales Forecasting Method.

Board Policies:

1- Gross Plant & Equipment Depreciation ratio is accepted as %20.

2- All assets in the balance sheet will increase at the same rate as sales increase.

3- All Current Liabilities in the balance sheet will increase at the same rate as sales.

4- 100.000 additional  Long Term Bonds will take place in 2019.

5- For long term capital:

            a- 50.000 new preferred stocks will be issued

b- A long term loan will be activated as 150.000 USD

            b- Additional New stocks will be issued at 200.000 USD

6- Net Profitability is %20 of total sales.

7- %30 of Net Profit will be distributed as dividends

8- Remaining %70 of Net Profit will be retained in the company

Based on 2019’s projected sales;

            a- Calculate the forecast basis for assets and current liabilities

            b- Calculate the amount of Financing Required ( capital deficit)

            c- Prepare the Pro-Forma Balance Sheet.
 

GIRO SPORT DESIGN Balance Sheet Statements for Year Ending December 31, 2018 (Millions of Dollars) 2018 2018 ASSETS LIABILITIES $18.320 $22.800 Accounts Payable $8.800 $6.960 Cash and Marketable Securities Accounts Receivable Wages $6.080 $21.840 Inventories $15.200 Accruals Sayfa Total Current Assets $56.320 Total Current Liabilities $59.200 $38.880 Gross Plant and Equipment Long Term Bonds $16.000 Less: Accumulated Depreciation Net Plant and Equipment $20.320 Total Liabilities $37.840 Preferred Stock Common Stock(250.000.000) Retained Earnings $12.000 $26.800 $38.800 Owner's Equity TOTAL ASSETS $76.640 TOTAL LIABILITIES AND EQUITY $76.640