Prepare a proforma income statement
Sales - 960,000
During the yr ending december 31 2017 sales are expected to increase 5%
on Dec 31 ABC will pay off all of its short term debt. Interest on any short term borrowing carrier an annual interest of 6%
on dec 31 each year ABC repays $50,000 towards reducing the principal on its long term debt. The balance on the long term debt as of dec 31 2017 will be $407,000. Long term debt carrier an annual interest of 6%
Depreciation expense in 2017 is 276,000
no new capital spending will occur during 2017
THe effective tax is 40%