Question
1. Sales from MOCI companies at the end of 2021 were recorded at $ 101,000. COGS is $78,000. The net income the company made is
1. Sales from MOCI companies at the end of 2021 were recorded at $ 101,000. COGS is $78,000. The net income the company made is $ 50,000. The company's total assets are $ 130,000. Company liabilities consist of Accounts Payable of $ 20,000, Accrued Payable of $ 4,000, and Long-Term Liabilities of $ 5,000 used to purchase fixed assets. Suppose the company distributes dividends of $ 13,000 and has beginning equity of $ 60,000. Calculate the company's sustainable growth and Additional Funds Needed for 2022. Based on your calculation, analyze the company's financial future conditions. Calculate the company's sustainable growth and Additional Funds Needed for 2022. Based on your calculation, analyze the company's financial future conditions.
2. Arrange the OTHER co. Income Statement Projection for five years using the assumptions listed below, and then analyze the company's future financial condition. The OTHER co. is engaged in the toy industry. This year the company has planned to start its business. In the first year, the company is projected to sell 3,300 dolls worth $ 2.1 per unit, 2,700 board games worth $ 2.3 per unit, and 2,100 balls worth $ 1.1 per unit. The sales projection in the second year is assumed to increase by 2% from the previous year. In the third year, the company reached a rapid growth stage. The sales growth is assumed to increase by 170 percent from the previous year. The company reached the maturity stage in the following year, so the annual sales growth was assumed to increase fixed at 3 percent from the previous year.
The cost assumptions issued by the company are as follows:
Tax is assumed at 10 percent of EBT (Earnings Before Tax)
Depreciation costs are assumed to be fixed at $1,000 per year
The company has no debt or liabilities
Marketing expenses are assumed to be 20% of sales
Employee salaries are $1,300 per year and will be increased by 1% in the following year. COGS is assumed to be 41% of sales
Other operational expenses are assumed to be 10% of sales
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