Task 6: Estimate a projected Income Statement Estimate a projected four-year Income Statement, based on the above
assumptions and the following additional assumptions: • Depreciation is estimated as being equal to 10% of PPE at the end of the prior year. • Tax is estimated as being expensed at 30% of Earnings before Tax. Assume that any tax benefits are NOT carried forward to reduce future tax payable. • Assume NO dividends are declared and Retained Earnings equals Net Income.
Task 7: Estimate a projected Balance Sheet Estimate a projected four-year Balance Sheet, based on the above assumptions and the following additional assumptions: • Summarised the Balance Sheet at the end of the year prior to First Year was comprised as follows: Cash $50,000; Inventories $1,000,000; Property Plant and Equipment (PPE) $4,000,000; Debt $2,000,000 and Owners Equity $3,050,000. You should assume all other prior period Balance Sheet values were zero. • Check to see that the Balance Sheet balances each year, in so far as Total Assets equals Total Equity and Liabilities. Task 8: Estimate a projected Cash Flow Statement Estimate a projected four-year Cash Flow Statement, based on the above assumptions. • Check to see that the Period Ending Cash Balance each year equals the Cash Balance in the Balance Sheet for the same year.
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