Problem:
Using Excel, create a three year Pro Forma income statement and determine break even point on the data attached.
Based on the organization you have created
a. Using Excel, create a three year Pro Forma income statement for your organization (or product/service).
b. What will be your financial break-even point?
Expected sales revenue . . $2,000,000
Manufacturing costs:
Variable cost of goods sold . 325,000
Fixed overhead . . . . . . . .300,000
Selling expenses:
Variable expenses . . . . . . 140,000
Fixed expenses . . . . . . . . 45,000
Administrative expenses:
Variable expenses . . . . . . .45,000
Fixed expenses . . . . . . . .160,000
Other:
Interest expense . . . . . . . 28,000
Income tax rate . . . . . . . . . 35%