The cash budget for Parker Process Meats, Inc. for the fourth quarter of 2004 is given below:
Parker Process Meats, Inc.
Cash Budget for the Three Months Ending December 31, 2004
Cash receipts Oct. Nov. Dec.
Total collections $31,050 $ 4,050 $49,950
Purchases 44,550 48,600 52,650
Wages and salaries 7,425 7,425 7,425
Other expenses 2,025 1,350 675
Total disbursements $54,000 $57,375 $78,165
The expected sales for the period are as follows:
Oct.: $86,400 Nov.: $91,800 Dec.: $83,700
The total depreciation expense for the period will be $8,775. An interest payment on outstanding debt of $15,000 will be made in December. Using the information given, construct a pro forma income statement for the final quarter of 2004 for Parker.
The problem requires that an income statement be prepared from provided information.