You have worked to establish both the required costs and revenue streams for your event or idea. Based on feedback from your instructor and peers, create a pro forma balance sheet, income statement,...

Create a pro forma balance sheet, income statement, and statement of cash flow
Introduction
Caterpillar Inc is a fortune 100 company and specializes in manufacturing, engineering and selling of heavy trucks and equipments as well as financial services. It is presently a public company and trades in the NYSE with the symbol CAT. It was founded in the year 1925 and is presently headquartered in Deerfield, Illinois, United States. Presently the net income of the company stands at US$2.98 billion as of FY-2020 and is expected to grow in the future years to come. It is headed by Jim Umpleby who is the acting Chairman and CEO of the company.
In the preparation of the pro-forma balance sheet, income statement and statement of cash flow we have take the financials of American popular truck company named Caterpillar (CAT). The data has been extracted from yahoo finance for the period 2017 to 2020. For the FY-2021 we have tried to project the financial statements using the criteria explained below:
Income Statement of Caterpillar
    Caterpillar (CAT)
    Projected
    Actual
    Actual
    Actual
    Actual
    Income Statement
    30-12-2021
    30-12-2020
    30-12-2019
    30-12-2018
    30-12-2017
    Total revenue
    43417920
    4,17,48,000
    5,38,00,000
    5,47,22,000
    4,54,62,000
    Growth (%)
    4%
    -29%
    -2%
    17%
     
    Cost of revenue
    30318308
    2,96,71,000
    3,73,84,000
    3,77,19,000
    3,16,95,000
    % of Sales
    70%
    71%
    69%
    69%
     
    Gross profit
    13099612
    1,20,77,000
    1,64,16,000
    1,70,03,000
    1,37,67,000
    Operating expenses
     
     
     
     
     
    Research development
    1435244
    14,15,000
    16,93,000
    18,50,000
    19,05,000
    % of Sales
    3%
    3%
    3%
    3%
     
    Selling general and administrative
    4446645
    46,42,000
    51,62,000
    54,78,000
    51,77,000
    % of Sales
    10%
    11%
    10%
    10%
     
    Total operating expenses
    5881889
    75,24,000
    81,26,000
    87,10,000
    93,61,000
    Operating income or loss
    7217723
    45,53,000
    82,90,000
    82,93,000
    44,06,000
    Interest expense
    4,67,500
    5,14,000
    4,21,000
    4,04,000
    5,31,000
    Total other income/expenses net
    9,750
    -44,000
    -57,000
    -67,000
    2,07,000
    Income before tax
    67,59,973
    39,95,000
    78,12,000
    78,22,000
    40,82,000
    Income tax expense
    1560195
    10,06,000
    17,46,000
    16,98,000
    33,39,000
    Tax Rate %
    23%
    25%
    22%
    22%
     
    Net income
    51,99,778
    29,98,000
    60,93,000
    61,47,000
    7,54,000
    Net income available to common shareholders
    29,98,000
    29,98,000
    60,93,000
    61,47,000
    7,54,000
    Basic EPS
    5.63
    0
    10.85
    10.39
    1.27
    Diluted EPS
    5.57
    0
    10.74
    10.26
    1.26
    Basic average shares
    436200
    0
    5,61,600
    5,91,400
    5,91,800
    Diluted average shares
    441550
    0
    5,67,500
    5,99,400
    5,99,300
    EBITDA
    9058250
    69,41,000
    1,08,10,000
    1,09,92,000
    74,90,000
Analysis
For calculation of the projected figures of FY-2021 we have used the formula (current year – previous year) ÷ Previous year x 100 of years 2018 to 2020. Then we have taken an estimated growth of only 4% in 2021. The % growth in cost of revenue has been estimated for the actual years as a percentage of sales and then taking the average of all the years for deriving at the projected growth rate of FY-2021. The projected cost of revenue for FY-2021 has been calculated by multiplying the revenue by % of sales.
For calculation of operating expenses like research and development as well as selling, general and administrative expenses we have done similar process of estimating these expenses as a % of sales.
For calculation of interest expenses and total other income/ expenses of FY-2021, we have taken the average of the previous year’s figures.
The income tax rate of FY-2021 projected is calculated by taking the average of the...