Question

U wil, is Sater to stay in Protected View Enable Edit SIGN IN TO OFFICE It looks like your stored credentials are out of date. Please sign in as [email protected] so we can verify your subscription A35 X for B C D E BALANCE SHEET % of sales next year % of sales Current assets Net fixed assets TOTAL ASSETS current year 45,000,000 50,000,000 95,000,000 0% 30 Current Liabilities Long-term debt TOTAL LIABILITIES Common stock/paid-in capital Retained earnings COMMON EQUITY TOTAL LIABILITIES & EQUITY 15,000,000 30,000,000 45,000,000 25,000,000 25,000,000 50,000,000 95,000,000 Instructions Financial Stmt Analysis Fin'l Forecasting Leverage EAR 1 - TVM2 - TVM3 - TVM4 - TVM Ready

Answer 1

Answer:

∆ Sales = 100000000 - 90000000 = $10,000,000

Discretionary Financing Needs = $2,500,000 + (Current Assets / Sales) * ∆ Sales - (Spontaneous liabilities / Sales) * ∆ Sales - (Projected Sales * Net profit margin - Dividend)

= 2500000 + 45000000 / 90000000 * 10000000 - 15000000 / 90000000 * 10000000 - (100000000 * 6% - 2000000)

= 1833333.33

Discretionary Financing Needs = 1,833,333.33

BALANCE SHEET Current Assets Net Fixed Assets TOTAL ASSETS Current % of Year sales 45,000,000 50,000,000 95,000,000 Next Year 0.5 50,000,000 52,500,000 102,500,000 0.16667 Current Liabilities Long-Term Debts TOTAL LIABILITIES Common Stock/Paid in capital Retained Earnings COMMON EQUITY TOTAL LIABILITIES & EQUITY 15,000,000 30,000,000 45,000,000 25,000,000 25,000,000 50,000,000 95,000,000 16,666,667 30,000,000 46,666,667 25,000,000 29,000,000 54,000,000 100,666,667 Discretionary Financing needs 1,833,333|

Above excel with 'show formula' is as follows:

BALANCE SHEET Current Assets Net Fixed Assets TOTAL ASSETS Current Year 45000000 50000000 =C24+C25 % of Next sales Year =C24/90000000 =100000000*D24 =C25+2500000 =E24+E25 Current Liabilities 15000000 Long-Term Debts 30000000 TOTAL LIABILITIES =C28+C29 Common Stock/Paid in capital 25000000 Retained Earnings 25000000 COMMON EQUITY =C31+C32 TOTAL LIABILITIES & EQUITY =C30+C33 =C28/90000000 =D28*100000000 =C29 =E28+E29 =C31 =C32+(100000000*6%-2000000) =E31+E32 =E33+E30 Discretionary Financing needs =E26-E34