FIN 200 wk 5 Alternative Financing Plans (1)

Apr 18th, 2015
Studypool Tutor
University of Phoenix
Course: Business and Management
Price: $15 USD

Tutor description

Word Count: 387
Showing Page: 1/6
Balance Sheet and Forecasting CalculationsFIN 200Axia College of University 1 a. Pro Forma Balance Sheet as of Dec. 31, 2006 Assets LiabilitiesCash $300,000 Accounts Payable $900,000Accounts Receivable600,000 Notes Payable 1,000,000 Inventories 1,800,000 Long-term Debt 200,000Fixed Assets, net 750,000 Stockholders' Equity 1,350,000 Total Assets $3,450,000 Total Liabilities and Stockholders' Eq.$3,450,000So the additional financing needed is the difference between the projected Notes Payable above and last year's Notes Payable: $1,000,000 - $500,000 = $500,000Note: Cash = 5% of salesAccounts receivable = 10% of salesInventories = 30% of salesFixed assets, net = 12.5% of salesAccounts payable = 15% of salesAddition to retained earnings in 2006 = 2006 net income - dividends paid in 2006 = $400,000 - $50,000 = $350,000 Alternatively, we can solve for the additional financing needed using equation (5.3):AdditionalFinancing = [(A/S)(DS) - (CL/S)(DS)] - [NI - D]NeededA = $2,300,000 S = $4,000,000 DS = $2,000,000D = $50,000 NI = $400,000 CL = $600,000 = [(2,300,000/4,000,000)(2,000,000) -

Review from student

Studypool Student
" Thanks, good work "
Ask your homework questions. Receive quality answers!

Type your question here (or upload an image)

1831 tutors are online

Brown University





1271 Tutors

California Institute of Technology




2131 Tutors

Carnegie Mellon University




982 Tutors

Columbia University





1256 Tutors

Dartmouth University





2113 Tutors

Emory University





2279 Tutors

Harvard University





599 Tutors

Massachusetts Institute of Technology



2319 Tutors

New York University





1645 Tutors

Notre Dam University





1911 Tutors

Oklahoma University





2122 Tutors

Pennsylvania State University





932 Tutors

Princeton University





1211 Tutors

Stanford University





983 Tutors

University of California





1282 Tutors

Oxford University





123 Tutors

Yale University





2325 Tutors