Using the 2012 financial statements for DRE Corporation and this additional information,prepare a pro forma income statement and balance sheet for the year 2013.Determine the discretionary financing needed (DFN)and assume that if the DFN is positive,the company will increase long-term debt,and if DFN is negative,the company will pay back some long-term debt.
Sales for next year (2013)are expected to increase by $300,000 to $1,800,000.The firm is running efficiently and at full capacity so that all assets and spontaneous liabilities are expected to increase proportionally with sales.The dividend payout ratio for 2013 will be 40%.
DRE Corporation
2012 Financial Statements
Definitions:
Bricklayers
Skilled tradespeople who lay bricks to construct brickwork, which includes walls, foundations, and other structures.
White Men
A demographic group characterized by individuals of European descent, often discussed in sociological and demographic studies.
Ethnicity
A category of people who identify with each other based on common ancestral, social, cultural, or national experiences.
Perfectly Competitive
A market structure where many firms sell identical products, no barriers to entry exist, and no single buyer or seller can affect the market price.
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