Home » Construct a pro forma income statement for the first year and second year for the following assumptions

Construct a pro forma income statement for the first year and second year for the following assumptions

1. Construct a pro forma income statement for the first year and second year for the following assumptions:Units of Sales in Year 1: 110,000Price per Unit: $11Variable cost per unit: 30%Fixed Costs: $125,000Income taxes: 15%Interest Expense: $200,000In year 2, Price per unit increases to $11.50, and unit of sales increases by 5%, all other assumptions remain the same.2. Calculate a table of interest rates for 5 years based on the following information:The pure interest rate is 2%Inflation expectations for year 1 = 3%, year 2 =4%, years 3-5 =5%The default risk is .1% for year one and increases by .1% over each yearLiquidity premium is 0 for year 1 and increases by .2% each yearMaturity risk premium is 0 for years 1 and 2 and .3% for years 3-53. Calculate the sustainable growth based on the following information:* earning after taxes = $35,000* equity = $100,000* d=22.4%4. Future value of single sum problemYou put $2,000 in an investment account today which will earn 8% over the next 14 years, what is the future value?5. Future value of annuity problemYou deposit $10,000 into a retirement account at the end of the next 10 years earning 9% interest, what is the future value of your retirement after 10 years?

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