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Pro Forma Financial Statements

Pro forma financial statements are financial statements that are prepared using hypothetical amounts or estimates and excludes extrao-ordinary or one time items. They may also be prepared to show the expected results of a future change, such as a merger or acquisition. In most cases, company's prepare pro forma financial statements to present a picture of what the company's financial picture would look like without extraordinary items. The intention is to more accurately represent the companies financial picture if the pro forma statements were used to project or estimate the company's future performance. Companies feel that pro forma statements are more representative when it comes to valuing the company. 

Common items that are excluded form pro form income statements include depreciation, amortization, restructuring and merger costs, interest and taxes, stock based compensation, and one time expenses. Depreciation and amortization are often excluded because they do not reflect a cash expense. One time expenses are often excluded because they distort an accurate picture of the firm's future profitability. Since pro forma statements are not required to follow GAAP, the lack of regulation makes them much more susceptible to manipulation. 

Apple, Inc.: Financial Ratio Analysis

Please help in reviewing and analyzing Apple, Inc's financial statements from the past 3 years: 2011, 2012, and 2013. Calculate (show calculations) the financial ratios of Apple's financial statements, and then interpret those results against company historical data as well as industry benchmarks: •Compare the financia

Clearwater Development Co. Pro forma Percentage of sales method

The 2010 sales forecast for Clearwater Development Co. is $150 million. Interest expense will not change in the coming year. Use Clearwater's 2009 income statement ($ in thousands) presented below to answer the questions that follow: Clearwater Development Co. Income Statement Sales $125,000 Less: Cost of goods sold 80

Pro Forma Earnings

Please see attached question. Thank you for your assistance! Which one is not correct for pro forma earnings? A. Pro forma earnings are used in valuation by the investor. B. Pro forma earnings are based on the current GAAP. C. The company does not need to disclose how to calculate the pro forma earnings. D. Pro forma ea

Financial Planning and Pro Forma Analysis

INCOME STATEMENT: Sales 2000,000 Costs except depreciation (100,000) -------------------------------------------------- EBITA 100,000 Depreciation (6,000) -------------------------------------------------- EBIT

Pro Forma Financials for Wal-Mart

Based on the financial statement in the annual report for Wal-mart develop a set of Pro Forma financials (income statement and balance sheet) for the next fiscal year-end using the precent-of-sales method. Assume that the company's sales have increased by 15% State what additional assumptions and information that you would ne

Pro Forma Financial

We have to prepare a Pro Forma on McDonalds a. Develop a set of pro forma financials (income statement and balance sheet only) for the next fiscal year-end using the percent-of-sales method. Assume that the company's sales have increased by 15%. Then with the shortfall we need to decide what to do. Either we sell more s

Describing results of the attached pro forma statement

I need assistance in describing results of the attached pro forma statement and making recommendations to management based on these results. Need this in a summarized form. No need for spreadsheet work....Just a couple of paragraphs would be okay. Some assumptions used in compliling the attached pro-forma are. -Assets a