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Question
The cash budget for Parker Processed Meats, Inc. is given below for the fourth quarter of 2010:Parker Processed Meats, Inc.
Cash Budget for the Three Months Ending December 31, 2010
| Cash receipts | Oct. | Nov. | Dec. | |
| Total collections | $37,050 | $48,075 | $69,750 | |
| Cash disbursements: | ||||
| Purchases | $45,780 | $50,800 | $54,250 | |
| Wages and salaries | $8,500 | $8,500 | $8,500 | |
| Other expenses | $4,025 | $2,350 | $975 | |
| Taxes | $16,350 | |||
| Total disbursements | $54,000 | $57,375 | $78,165 |
The expected sales for the period are as follows:
Oct.: $116,000 Nov.: $127,000 Dec.: $95,000
The total depreciation expense for the period will be $12,000.
An interest payment on outstanding debt of $13,000 will be made in December. Using the information given above, construct a pro forma income statement for the final quarter of 2010.
Answer
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