2 answers

 Red Queen Restaurants wishes to prepare financial plans. Use the financial statements and the other information...

Question:

 Red Queen Restaurants wishes to prepare financial plans. Use the financial statements and the other information provided here to prepare the financial plans. The following financial data are also​ available:

​(1) The firm has estimated that its sales for 2020 will be $900,600.

​(2) The firm expects to pay $35,600 in cash dividends in 2020.

​(3) The firm wishes to maintain a minimum cash balance of $30,000.

​(4) Accounts receivable represent approximately 21% of annual sales.

​(5) The​ firm's ending inventory will change directly with changes in sales in 2020.

​(6) A new machine costing $42,000 will be purchased in 2020. Total depreciation for2020 will be $16,700.

​(7) Accounts payable will change directly in response to changes in sales in 2020.

​(8) Taxes payable will equal​ one-fourth of the tax liability on the pro forma income statement.

​(9) Marketable​ securities, other current​ liabilities, long-term​ debt, and common stock will remain unchanged.

a. Prepare a pro forma income statement for the year ended December​ 31, 2020​, using the ​percent-of-sales method.

b. Prepare a pro forma balance sheet dated December​ 31, 2020​, using the judgmental approach.

Red Queen Restaurants Income Statement for the Year Ended December 31, 2019 Sales revenue $799,900 Less: Cost of goods sold 6

Red Queen Restaurants Income Statement for the Year Ended December 31, 2019 Sales revenue $799,900 Less: Cost of goods sold 600,200 Gross profits $199,700 Less: Operating expenses 101,000 Net profits before taxes $98,700 Less: Taxes (rate = 21%) 20,727 Net profits after taxes $77,973 Less: Cash dividends 19,300 To retained earnings $58,673 Red Queen Restaurants Balance Sheet December 31, 2019 Assets Liabilities and Stockholders' Equity Cash $32,100 Accounts payable $100,600 Marketable securities 18,700 Taxes payable 19,900 Accounts receivable 150,500 Other current liabilities 5,900 Inventories 99,100 Total current liabilities $126,400 Total current assets $300,400 Long-term debt $200,600 Net fixed assets 350,600 Common stock $149,000 Retained earnings $175,000 Total assets $651,000 Total liabilities and equity $651,000

Answers

Protoma Income Statement $ 900600 Sales Revenue $ 675760 E Cost of good sold $224840 $117700 $107140 Met profut before tuges.Dabe Based on all these financial statements, it seems like asset outweighs the liabilities & equity . There isnt much gross

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