QUESTION 1 (20 Marks) 1.1 REQUIRED Use the following financial
data to prepare the Pro Forma….
QUESTION 1 (20 Marks) 1.1 REQUIRED Use the following financial
data to prepare the Pro Forma Statement of Financial Position as at
31 December 2021.
INFORMATION
Stylcor Ltd has provided the following financial data needed to
prepare the Pro Forma Statement of Financial Position as at 31
December 2021.
? Sales for 2020 amounted to R3 800 000 and sales for 2021 are
estimated to increase to R4 000 000.
? Plant and equipment costing R300 000 will be purchased during
2021. Total depreciation for 2021 is expected to amount to R225
000.
? The following must be projected using the percentage of
sales:
? Inventory
? Accounts receivable
? Accounts payable
? The business will maintain a cash balance of R120 000 and any
surplus cash will be invested in long term financial
investments.
? 50 000 shares at R5 each are expected to be issued in June
2021.
? The business predicts an 8% net profit margin.
? A final dividend of 20 cents per share is expected to be
proposed in December 2021, payable in January 2022.
? The long term loan will be reduced by capital payments
amounting to R50 000
The Statement of Financial Position as at 31 December 2020 is as
follows
ASSETS | |
Non-current assets | 2 100 000 |
Fixed/Tangible assets | 2 100 000 |
1 596 000 | |
Current assets | |
Inventories | 532 000 |
Accounts receivable | 760 000 |
Cash and cash equivalents |
304 000 |
Total assets |
3 696 000 |
EQUITY AND LIABILITIES | |
Equity | 2 336 000 |
Ordinary share capital (500 000 shares) | 1 500 000 |
Retained earnings |
836 000 |
Non-current liabilities | 410 000 |
Long-term loan | 410 000 |
Current liabilities | 950 000 |
Accounts payable | 950 000 |
Total equity and liabilities | 3 696 000 |
QUESTION 1 (20 Marks) 1.1 REQUIRED Use the following financial
data to prepare the Pro Forma…