Use the "Percent of Sales Method" of Preparing Pro Forma

question 129

Multiple Choice

Use the "percent of sales method" of preparing pro forma financial statements to determine the projection for next year's cost of goods sold.Make the following assumptions: current year's sales are $27,800,000; current year's cost of goods sold is $17,528,000; sales are expected to rise by 30%.What is the projection for next year's cost of goods sold?

• A) $20,481,000
• B) $21,138,900
• C) $21,459,200
• D) $22,786,400

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Definitions:

Creditors

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Withdrawal Symptoms

Physical or psychological symptoms that occur after stopping or reducing the intake of a substance that the body has become dependent on.

Institutionalized

Refers to the process or state of being placed into and becoming accustomed to a structured institutional environment, such as a prison or mental health facility.

Sound Mind

A legal term denoting an individual's legal and mental capability to make decisions or enter into contracts, signifying that they are neither impaired nor incapacitated.