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Assignment #2: ALLGOMOTIVE INC (AGM)
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1.) Create the income statements for the fiscal 2015 pro-forma [NOTE: please use the same format for the income statement as in Exhibit 2]. (13 points)
AGM Income Statement
For fiscal year ending October 31st
Gross Profit 3,055,150 1,775,600
Rent 438,500 288,500
Depreciation Expense 146,625 57,500
Interest Expense 460,000 138,000
Salaries Expense 989,400 694,600
Operating Expenses: 2,207,525 1,361,600
Gains or Losses (190,000) -
Income before taxes 657,625 414,000
Income taxes (24%) 157,830 99,360
Net Income 499,795 314,640
2.) Create the statement of cash flows for the fiscal 2015 pro-forma using the indirect method. (22 points)
CDX Statement of Cash Flows
Net income $499,795
Loss on sale of equipment $190,000 (6) Depreciation $146,625
Increase in A/R