Reference no: EM13846589

Prepare a pro forma balance sheet for the upcoming fiscal year. Company X's current balance sheet, submitted at the end of their fiscal year, September 30, 2015, is displayed below. Company X has a policy of maintaining a cash balance of $75,000. The company plans to acquire a new building for 90,000, and purchase new equipment for $15,000 over the next year. Net sales over the previous year were $3.6 million and the company expects sales to grow by 8% in the next year, with a gross margin of 12%. Purchases of materials are expected to be $3.5 million, the collection period is expected to be 30 days and accounts payable will be 15 days. Net Income is anticipated to be 1.5% of sales, and the tax rate is 30%. Company policy is to have a retention ratio of 20%, and depreciation is expected to be $40,000 over the coming year