SOLVED NUMERICAL PROBLEMS
- P epare a proforma income statement if the sales in the current year amounting to Rs 6,00,000 are to move up in the next year by 10%. The cost of goods and the operating cost account for 60% and 10% respectively of the sale value. The interest payment during the current year is Rs 50,000. But, for increased sales, additional debt will be required and that will raise the interest payment to Rs 60,000. The tax rate is expected to remain unaltered at 30%.
Solution
Income Statement
Items Current year’s actuals Rs Projected figures for next year Rs Revenue from sales
6,00,0006,60,000Less cost of goods
3,60,0003,96,000Margin of contribution
2,40,0002,64,000Less operating cost
60,000
Get Fundamentals of Financial Management, Third Edition now with the O’Reilly learning platform.
O’Reilly members experience books, live events, courses curated by job role, and more from O’Reilly and nearly 200 top publishers.