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## Projected Income Statement

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**Projected Income Statement**Jeff’s Really Cool Stuff**Assumptions**• Percentage of Gross Income before Tax to Revenue = 15% • My tax rate = 25% • Cost of Goods Sold = 40% • Inventory Turnover - 37**Assumptions**• I want to have Net Income AFTER Tax of $60,000**Calculations**Net Income After Tax $60,000 $60,000 divided by the inverse (I minus the tax rate expressed as a decimal) of the tax rate = $60,000 divided by 1 minus .25 = $60,000 divided by .75 = Gross Income Before Tax of $80,000 Gross Income Before Tax $80,000 Tax (25%) $20,000**Calculations**Net Income After Tax $60,000 Revenue $? = 15% Gross Income Before Tax $80,000 Tax (25%) $20,000**Calculations**Net Income After Tax $60,000 Revenue $ 533,334 $80,000 divided by the Percentage of Net Income before Tax to Revenue = $80,000 divided by .15 = $533,334 Gross Income Before Tax $80,000 Tax (25%) $20,000**Calculations**Net Income After Tax $60,000 Revenue $ 533,334 Cost of Goods Sold = 40%, so .4 times $533,334 = $213,334 Cost of Goods Sold $213,334 Gross Income Before Tax $80,000 Tax (25%) $20,000**Calculations**Net Income After Tax $60,000 Revenue $ 533,334 Cost of Goods Sold $213,334 Gross Profit $320,000 $240,000 Operating Expenses $? Gross Income Before Tax $80,000 Tax (25%) $20,000**Calculations**Revenue $ 533,334 Inventory Turnover ratio = 37 Inventory Turnover ratio = Cost of Goods Sold divided by Average Inventory (Beginning Inventory plus Ending Inventory) divided by 2 Cost of Goods Sold $213,334**Calculations**Revenue $ 533,334 Beginning Inv $5,766 $213,334 divided by $? = 37 $213,334 divided by 37 = Ave Inven $213,334 divided by 37 = $5,766 Cost of Goods Sold $213,334**Calculations**Revenue $ 533,334 Beginning Inv $5,766 Purchases $213,334 GAS $219,100 Ending Inv $5,766 Cost of Goods Sold $213,334