A proposed new investment has projected sales of $660,000. Variable costs are 60

Question

A proposed new investment has projected sales of $660,000. Variable costs are 60 percent of sales, and fixed costs are $155,000; depreciation is $56,000. Prepare a pro forma income statement assuming a tax rate of 30 percent. What is the projected net income?

Sales =             ?

Variable Costs=     ?

Fixed Costs=     ?

Depreciation=     ?

EBT=              ?

Taxes=      ?

Net Income =     ?

A proposed new investment has projected sales of $660,000. Variable costs are 60 percent of sales, and fixed costs are $155,000; depreciation is $56,000. Prepare a pro forma income statement assuming a tax rate of 30 percent. What is the projected net income?

Sales =             ?

Variable Costs=     ?

Fixed Costs=     ?

Depreciation=     ?

EBT=              ?

Taxes=      ?

Net Income =     ?

Explanation / Answer

Sales 660000 Variable cost 396000 Contribution margin 264000 Fixed cost 155000 Depreciation 56000 EBT 53000 Net income 37100

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