a)
To calculate: Pro forma income statement using fixed cost method.
Introduction:
A reports that shows the revenues and expenses from business operations and the result of those operations as net income or net loss for a particular timeframe is referred to as income statement.
b)
To calculate: Pro forma
Introduction:
Balance Sheet summarizes the assets, the liabilities, and the shareholder’s equity of a company at a given date. It is also known as the statement of financial status of the business.
c)
To discuss: How much Additional financing is required by Company P for the year 2016.
Introduction:
Financing refers to the activities carried out by a company to mobilize funds to carry out the business activities. The examples for financing activities are purchase of bonds and issuing of common shares.
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Chapter 4 Solutions
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