Forecasted income Statement
Han Company wishes to forecast its net income for the year 2009. Han has assembled balance sheet and income statement data for 2008 and has also done a forecast of the balance sheet for 2009. In addition, Han has estimated that its sales in 2009 will rise to $2,200.This information is summarized in the following table.
|
|
|
2009 |
|
Balance Sheet |
2008 |
Forecasted |
|
Cash |
$ 20 |
$ 22 |
|
Other current assets |
500 |
550 |
|
Property, plant, and equipment (net) |
600 |
800 |
|
Total assets |
$1,120 |
$1,372 |
|
|
|
|
|
Accounts payable |
$ 200 |
$ 220 |
|
Bank loans payable |
600 |
500 |
|
Total stockholders’ equity |
320 |
652 |
|
Total liabilities and stockholders’ equity |
$1,120 |
$1,372 |
|
|
|
2009 |
|
Income Statement |
2008 |
Forecasted |
|
Sales |
$2,000 |
$2,200 |
|
Cost of goods sold |
700 |
|
|
Gross profit |
$1,300 |
|
|
Depreciation expense |
120 |
|
|
Other operating expenses |
1,010 |
|
|
Operating profit |
$ 170 |
|
|
Interest expense |
90 |
|
|
Income before taxes |
$ 80 |
|
|
Income taxes |
30 |
|
|
Net income |
$ 50 |
|
Instructions:
Prepare a forecasted income statement for 2009. Clearly state what assumptions you make.