Prepare the Proforma Balance sheet using the information below. Thank you

Addison Company Master Budget Practice Problem (includes Taxes) 1. Addison Company expects its Sales in January to be $150,000 and expects Sales to grow by 12% each month. 2. All sales are on credit and it collects 20% of all sales in the month of the sale, the remaining 80% in the month after the sale. 3. The cost of goods sold is equal to 70% of sales. 4. Addison Company likes to keep an ending inventory equal to 10% of next month's cost of goods sold on hand. 5. All purchases of inventory are on account, and the company pays for 90% of all purchases in the month of the purchase, 10% in the month after the purchase. 6. The company pays its sales force a commission equal to 4% of sales. 7. The company also believes that its supplies expense is equal to $3,000 plus 1% of sales. 8. Rent is $4,500 per month, Advertising is $3,500 per month, Depreciation is $2,000 per month, and Utilities are $1,500 per month. 9. The company purchased an insurance policy covering 12 months for $18,000 on January 1. 10. All selling and administrative expenses are paid in the month they are incurred except for commissions that are paid in the month after they are earned and the insurance which is paid one year in advance. 11. On January 31, Addison Company purchased Land costing $48,000. Addison paid cash for the land. 12. Interest on long-term debt is equal to 1% of the beginning balance and is paid each month. The company must maintain a minimum balance in cash of $10,000 and will use any cash surplus to pay down long-term debt. The company borrows cash in $1,000 increments. 13. The company is subject to a 25% income tax rate. The company pays income taxes in the month after they are accrued (expensed). 14. In January, the company will declare a $4,500 cash dividend, that it will pay in February. 15. The company had a beginning balance sheet (as of January 1) as follows: ASSETS: Current Assets Cash $10,000 $44,000 0 $16,800 $70,800 LIAB & STOCKHOLDERS EQUITY Current Liabilities Accounts Payable Commissions Payable Income Taxes Payable Dividends Payable Total Current Liabilities Long Term Debt Stockholders Equity Common Stock Retained Earnings Total Stockholders Equity Total liab & SE $15,680 $6,600 $1,000 $-0- $23,280 $60,000 Accounts Receivable Prepaid Insurance Inventory Total Currents Assets Property, Plant, & Equipment Land Equipment Accumulated Depreciation Total PPE $10,000 $40,000 ($20,000) $30,000 $10,000 $7.520 $17,520 $100,800 $100,800 Total Assets Addison Company Master Budget Practice Problem (includes Taxes) 1. Addison Company expects its Sales in January to be $150,000 and expects Sales to grow by 12% each month. 2. All sales are on credit and it collects 20% of all sales in the month of the sale, the remaining 80% in the month after the sale. 3. The cost of goods sold is equal to 70% of sales. 4. Addison Company likes to keep an ending inventory equal to 10% of next month's cost of goods sold on hand. 5. All purchases of inventory are on account, and the company pays for 90% of all purchases in the month of the purchase, 10% in the month after the purchase. 6. The company pays its sales force a commission equal to 4% of sales. 7. The company also believes that its supplies expense is equal to $3,000 plus 1% of sales. 8. Rent is $4,500 per month, Advertising is $3,500 per month, Depreciation is $2,000 per month, and Utilities are $1,500 per month. 9. The company purchased an insurance policy covering 12 months for $18,000 on January 1. 10. All selling and administrative expenses are paid in the month they are incurred except for commissions that are paid in the month after they are earned and the insurance which is paid one year in advance. 11. On January 31, Addison Company purchased Land costing $48,000. Addison paid cash for the land. 12. Interest on long-term debt is equal to 1% of the beginning balance and is paid each month. The company must maintain a minimum balance in cash of $10,000 and will use any cash surplus to pay down long-term debt. The company borrows cash in $1,000 increments. 13. The company is subject to a 25% income tax rate. The company pays income taxes in the month after they are accrued (expensed). 14. In January, the company will declare a $4,500 cash dividend, that it will pay in February. 15. The company had a beginning balance sheet (as of January 1) as follows: ASSETS: Current Assets Cash $10,000 $44,000 0 $16,800 $70,800 LIAB & STOCKHOLDERS EQUITY Current Liabilities Accounts Payable Commissions Payable Income Taxes Payable Dividends Payable Total Current Liabilities Long Term Debt Stockholders Equity Common Stock Retained Earnings Total Stockholders Equity Total liab & SE $15,680 $6,600 $1,000 $-0- $23,280 $60,000 Accounts Receivable Prepaid Insurance Inventory Total Currents Assets Property, Plant, & Equipment Land Equipment Accumulated Depreciation Total PPE $10,000 $40,000 ($20,000) $30,000 $10,000 $7.520 $17,520 $100,800 $100,800 Total Assets