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5. Use the Income Statement and Balance Sheet below along with forecast assumptions t build a forecast of the 2019 financial statements and the Additional

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5. Use the Income Statement and Balance Sheet below along with forecast assumptions t build a forecast of the 2019 financial statements and the Additional Funding Needed (alsc known as External Funding Required). SHOW YOUR WORK (20 points) Iterations Income Statement 2019 Assumptions 8 percent growth 75 percent of sales 2019F 2018 5,000 4,000 1,000 Net Sales Cost of goods sold Gross profit Expenses General, selling, and administrative expenses Net interest expense 20 percent of sales 10 percent interest 750 126 Earnings before tax Tax 124 25 percent tax 43 Earnings after tax Dividends 80 16 25 percent dividend pay Balance Sheet 2018 2019F Assets Current assets Cash and securities 685 25 days sales 32 day collection perioe Accounts receivable 890 Inventory Prepaid expenses Total current assets 500 7 times turnover 12 hold at 2018 level 2,087 Net foed assets 250 10 depreciation per yea Total assets 2,337 Liabilities and Owners' Equity Current liabilities Bank loan 753 plug, initially zero 25 days payable estimate hold at 2018 level Accounts payable 570 CMLTD Accrued wages Total current liabilities Long-term debt Common stock Retained earnings Total liabilities and owners' equity 10 4 1,337 500 10 amortization per yea hold at 2018 level 100 400 previous RE+N-divs 2,337 0 Answer 5. Use the Income Statement and Balance Sheet below along with forecast assumptions t build a forecast of the 2019 financial statements and the Additional Funding Needed (alsc known as External Funding Required). SHOW YOUR WORK (20 points) Iterations Income Statement 2019 Assumptions 8 percent growth 75 percent of sales 2019F 2018 5,000 4,000 1,000 Net Sales Cost of goods sold Gross profit Expenses General, selling, and administrative expenses Net interest expense 20 percent of sales 10 percent interest 750 126 Earnings before tax Tax 124 25 percent tax 43 Earnings after tax Dividends 80 16 25 percent dividend pay Balance Sheet 2018 2019F Assets Current assets Cash and securities 685 25 days sales 32 day collection perioe Accounts receivable 890 Inventory Prepaid expenses Total current assets 500 7 times turnover 12 hold at 2018 level 2,087 Net foed assets 250 10 depreciation per yea Total assets 2,337 Liabilities and Owners' Equity Current liabilities Bank loan 753 plug, initially zero 25 days payable estimate hold at 2018 level Accounts payable 570 CMLTD Accrued wages Total current liabilities Long-term debt Common stock Retained earnings Total liabilities and owners' equity 10 4 1,337 500 10 amortization per yea hold at 2018 level 100 400 previous RE+N-divs 2,337 0

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