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A proposed new investment has projected sales of $635,000. Variable costs are 44 percent of sales, and fixed costs are $193,000; depreciation is $54,000. Prepare a pro forma income statement assuming a tax rate of 35 percent. What is the projected net income?
A proposed new investment has projected sales of $635,000. Variable costs are 44 percent of sales, and fixed costs are $193,000; depreciation is $54,000. Prepare a pro forma income statement assuming a tax rate of 35 percent. What is the projected net income?
The projectednet incomefor the proposed new investment is $70,590.To prepare a pro forma income statement and calculate the projected net income:1. Calculate the variable costs: 44% of $635,000 (projected sales) = $279,4002. Calculate the contributionmargin: $635,000 (projectedsales) - $279,400 (variable costs) = $355,6003. Calculate the operating income: $355,600 (contribution margin) - $193,000 (fixed costs) - $54,000 (depreciation) = $108,6004. Calculate the income before taxes: $108,600 (operating income)5. Calculate the incometaxes: 35% of $108,600 (income before taxes) = $38,0106. Calculate the projected net income: $108,600 (income before taxes) - $38,010 (income taxes) = $70,590The proposed new investment is expected to generate a net income of $70.590.For more such questions onnet income, click on:brainly.com/question/28390284#SPJ11...