Question

XYZ Media, Inc. - Balance Sheet 2019 Actual 2020 Projected Cash Accounts Receivable Inventory Total Current Assets 30 S 360 S 360 $ 750 $ 42 504 504 1,050 Net Fixed Assets Total Asssets 750 1,500 $ $ 1,050 2.100 Accounts Payable Accruals Notes Payable Total Current Liabilities 75 $ 75 S 150 S 300 5 105 105 150 360 Long-term Debt 150 S 20 Common Stock Retained Earnings Total Liabilities and Owners Equity 750 $ 300 S 1,500 5 750 370 1,500 XYZ Media, Inc. - Income Statement 2019 Actual 2020 Projected Sales COGS Gross Margin S S 3,000.00 1,200.00 1,800.00 $ $ $ 4,200.00 1,680.00 2,520.00 General & Administrative Costs EBIT Interest EBT Taxes (259) Net Income 1,685.00 5 115.00 S 20.00 $ 95.00 $ 23.75 5 71.25 5 2.371.00 149.00 16.00 133.00 33.25 99.75 $ Dividends (30% of NI) Addition to Retained Earnings 21.38 $ 49.88 $ 29.93 69.83

14) How much working capital does the firm have? Actual in 2019 and projected in 2020.

Answer 1

	2019	2020
Working capital = Total current assets-Total current liabilities.
= 750-300 =	$             450
= 1050-360 =		$           690