Table 4.4 Use the Percent-Of-Sales Method to Prepare a Pro Forma Income

question 18

Multiple Choice

Table 4.4
Use the percent-of-sales method to prepare a pro forma income statement for the year ended December 31, 2010, for Hennesaw Lumber, Inc.
Hennesaw Lumber, Inc. estimates that its sales in 2000 will be $4,500,000. Interest expense is to remain unchanged at $105,000 and the firm plans to pay cash dividends of $150,000 during 2010. Hennesaw Lumber, Inc.'s income statement for the year ended December 31, 2009 is shown below. From your preparation of the pro forma income statement, answer the following multiple choice questions.
-The pro forma cost of goods sold for 2010 is ________. (See Table 4.4)

• A) $3,500,000
• B) $3,750,000
• C) $3,825,000
• D) $4,000,000

---

Definitions:

Conditional Positive Regard

Refers to accepting and loving someone only when they behave in a way that is acceptable or pleasing.

Actualizing

The process of making something real or bringing something into existence, often used in the context of personal growth and fulfilling potential.

Actualized

The process of realizing and expressing one's capabilities and creativities to their fullest extent.

Actualization

The process of realizing or achieving one's full potential or self-fulfillment, often associated with Maslow's hierarchy of needs.