Pro Forma Homework #4 Fall 2024 (2 points) Consider the following Pro Forma inputs given the current initial (first round) settings. (You may have noticed that these settings differ slightly from those described in the manual and in electronic reserves.) You may wish to save these settings. Pro Forma attempts to determine the second round result given the inputs specified below. As with the first, second and third assignment, in this fourth assignment, try to fill in the blanks, as shown on page 2. I'm giving you Total Assets from Pro Forma #3. For this one, you'll want to specify a number, but also explain how you got it. Do your best. Pro Forma Decision Sheet for Quarter 2 (inputs) Pro Forma Decision Sheet for Quarter 2 Units demanded 108000 Short term investments 1.00% Short term loan 1.50% Three-year loan 2.50% Preferred stock yield 3.00% Capital gains rate (Not relevant) Two year loan 2.00% Long-term loan 3.00% Company Operating Decisions Number of units to produce 100000 Per unit price $92.00 Dividends per share of common stock $0.15 Advertising costs per period SO Demand/price forecast Free Sales discount None New Investment Decisions Short-term investment $400.000 Risk of short-term investment 0 Units of machinery purchased Units of plant purchased 0 Capital budgeting project A no Capital budgeting project B no Financing Decisions DEBT: Short-term loans $0 Two-year loans So Three-year loans SO Ten-year bonds SO EQUITY: Preferred shares Common shares Common tender price (Not relevant, nothing tendered)Pro Forma Position Statement Quarter Number 2 Total Assets $17,380,857 LIABILITIES AND OWNER EQUITY Amount How found? Current Liabilities Accounts Payable Short Term Loans Payable 111 Short Term Penalty Loan Intermediate Term Debt Maturing Bonds Maturing Total Current Liabilities Long Term Liabilities Intermediate Loans: 2 years 3 years Bonds Total Long Term Liabilities Total Liabilities Owners' Equity Preferred Stock ( 0 shares ) Common Stock ( 1,000,000 shares ) Retained Earnings Total Equity Total Liabilities and EquityIntermediate Term Loan Interest 83, 030 Bond Interest 83, 600 Bond Redemption Costs Total Financial Charges 116. 630 2. 116, 730 Operating Income Before Extraordinary Items $11, 748, 780 Extraordinary Items 0 Income Before Taxes $11, 748, 779 Income Tax (rate is 30%) 3. 524. 633 Income After Taxes $8, 224, 146 Preferred Stock Dividind 0 Earnings to Common Stockholders $8, 224, 146 Common Stock Dividends ( $0. 64 per share ) 640. 000 Net Income Transferred to Retained Earnings $7. 584, 146 Pro Forma Position Statement Quarter Number 2 ASSETS Current Assets Cash $1, 339, 626 Marketable Securities 330, 000 Accounts Receivable 3, 400, 000 Inventory ( 17, 280 units at $61. 94 /UNIT ) 1. 070. 408 Total Current Assets $16, 140, 033 Fixed Assets (net of depreciation Machinery and Equipment $1, 548, 000 Plant 6. 238, 750 Total Fixed Asset 7. 786. 750 Total Assets $23, 926, 783 LIABILITIES AND OWNER EQUITY Current Liabilities accounts Payable $430, 000 Short Term Loans Payable Short Term Penalty Loan Intermediate Term Debt Maturing 1, 550, 000 Bonds Maturing 1. 200, 000 Total Current Liabilities $3, 180, 000 long Term Liabilities Intermediate Loans: 2 years $625, 000 3 years Bonds 900. 000 Total Long Term Liabilities 1, 525, 000 Total Liabilities $4, 705, 000 Owners' Equity Preferred Stock ( 0 shares ) SO Common Stock ( 1, 000, 000 shares ) 8, 000, 000 Retained Earnings 11, 221, 783 Total Equity 19. 221. 782 Total Liabilities and Equity $23, 926, 783 INFORMATION FOR FUTURE QUARTERS: Units of plant capacity 100, 000 100, 500 80, 500 50, 500 Units of machine capacity 100, 500 75, 500 60, 500 60, 500 Other overhead 200, 000 200, 000 200, 000 200, 000 Depreciation: Machinery 180, 375 386, 625 313, 500 313, 500 Projects 0 0 0 0 Plant 1, 300, 000 1, 318, 675 1, 007, 675 686, 175 Principal repayment on debt: Short-term 0 0 2-year 312, 500 312, 500 312, 500 312, 500 3-year 300, 000 Bonds 300, 000 300, 000 300, 000 300, 000 Warehouse fees: Units First 2000 Next 5000 Over 7000 Cost/Unit $1. 00 $3. 00 Production costs per unit next quarter: Windows $8. 00 Materials $6. 00 Machinery $47. 00 Plant Call" 19"$321:100 Windows. Inits First 60, 000 Next 40, 000 Next 20, 000 Over 120, 000 Labor cost $39. 00 $29. 00 $25. 00 $33. 00