Question
You have a business that just ended its fourth year. The fourth-year income statement and ending balance sheet are as follows: Revenue $1,000,000 COGS 500,000
You have a business that just ended its fourth year. The fourth-year income statement and ending balance sheet are as follows:
Revenue $1,000,000
COGS 500,000
Gross profit 500,000
Other variable expenses 100,000
Depreciation 25,000
Other fixed expenses 300,000
Net profit 75,000
Cash 50,000 A/P 25,000
A/R 100,000 Other short-term debt 100,000
Inventory 125,000 Long term debt 75,000
Capital assets 125,000 Equity 200,000
You believe that revenues will grow by 20% next year. How much additional funding will you need to support this revenue growth, regardless of source?
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Intermediate Accounting
Authors: James D. Stice, Earl K. Stice, Fred Skousen
17th Edition
032459237X, 978-0324592375
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