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meowmeowcow
meowmeowcow
05.03.2020 • 
Business

CROSBY, INC.
2017 Income Statement

Sales $746,000
Costs 581,000
Other expenses 17,000
Earnings before interest and taxes $ 148,000
Interest paid 13,000
Taxable income $ 135,000
Taxes (23%) 31,050
Net income $ 103,950
Dividends $ 31,185
Addition to retained earnings 72,765

CROSBY, INC.
Balance Sheet as of December 31, 2017

Assets Liabilities and Owners' Equity
Current assets Current liabilities
Cash $ 20,540 Accounts payable $ 54,700
Accounts receivable 43,480 Notes payable 13,900
Inventory 90,960 Total $ 68,600
Total $ 154,980 Long-term debt $ 129,000
Fixed assets Owners' equity
Net plant and- Common stock and-
equipment $422,000 paid-in surplus $114,000
Retained earnings 265,380
Total $379,380
Total assets $576.980 Total liabilities and
owners' equity $576,980

In 2017, the firm operated at 75 percent of capacity. Construct the pro forma income statement and balance sheet for the company. Assume that fixed assets are sold so that the company has a 100 percent asset utilization. (Do not round intermediate calculations.)

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