Use the “percent of sales method” of preparing pro forma financial statements to determine the projection for next year’s cost of goods sold

Business Jan 27, 2021

Use the “percent of sales method” of preparing pro forma financial statements to determine the projection for next year’s cost of goods sold. Make the following assumptions: current year’s sales are $27,800,000; current year’s cost of goods sold is $17,528,000; sales are expected to rise by 30%. What is the projection for next year’s cost of goods sold?

a. $21,459,200

b. $22,786,400

c. $20,481,000

d. $21,138,900