WASP Berhad projected sales of 30,000 units of Product X in year 1 and expected sales to increase 10% year-on-year. The selling price is RM112 per unit and the production and shipping is 35% of the selling price. The selling price is to increase by 5% year on year. Additional operational cost of RM485,000 will be incurred every year, with interest expenses of RM55,000 per year. In the 5th year, the company will be selling its' equipment at a loss on disposal of RM22,182. The company’s tax rate is 24%. Prepare the Proforma Income Statement for 5 years and calculate the Operating Cash Flows year on year.

Answer rating: 100% (QA)

To prepare a Proforma Income Statement for 5 years and calculate the Operating Cash Flows year on ye... View the full answer