Your group has been asked to produce pro forma financial statements for a small local bicycle shop.
Question:
Your group has been asked to produce pro forma financial statements for a small local bicycle shop. You are asked to provide a gross profit review, pro forma income statement and pro forma balance sheet. You also recognize you will need to perform other calculations to arrive at the required outputs. You have been given the information below to get you started.
Sales projection for the next 12 months
Product | Sale Price | Quantity |
Bicycles | $1,500 | 150 |
Helmets | $50 | 80 |
Cycling Shoes | $125 | 50 |
Beginning Inventory and Value
Product | Cost | Quantity |
Bicycles | $750 | 25 |
Helmets | $20 | 10 |
Cycling Shoes | $50 | 5 |
Ending inventory requested at 10%
Cost per item is expected to increase by 15%
Cash Budget Sales Forecast and Monthly Cash Payments by Mont
Month | Sales | Payments |
January | $5,000 | $7,000 |
February | $5,500 | $7,600 |
March | $13,800 | $10,500 |
April | $25,000 | $17,800 |
May | $28,400 | $18,200 |
June | $45,000 | $22,800 |
July | $38,000 | $23,800 |
August | $31,250 | $21,200 |
September | $10,000 | $8,000 |
October | $12,500 | $9,500 |
November | $9,800 | $7,800 |
December | $11,000 | $9,700 |
Cash collections at 20% of the current month and 80% collected the next month.
Assume a beginning cash balance of $5,000.
Monthly loan repayment is $4,250 from financing in the previous year.
Expert Answer:
Gross Profit Review Product Sale Price Quantity Cost Gross Profit Bicycles 1500 150 750 750 Helmets ... View the full answer
