Benso Oil Palm Plantations has just rolled out it 10-year strategic plan. The plan requires some changes to the firms financing and operating activities. As the Chief Financial Officer, you are concerned about the effect of these changes on the External Financing Needs of the firm. Against each of the statements below, indicate if the decision will lead to an increase, decrease, or no effect on the external finance that the firm needs a. BOPP decides to increase its dividend payout ratio. ................................................. b. BOPP decides that rather than wait for 25 days before paying suppliers, the firm will pay all suppliers immediately after they deliver items so they can take advantage of trade discounts. ....................................................... c. In order to increase sales, BOPP has decided to offer its customers credit, in the past, all sales had been on a cash basis. ......................................................................... d. BOPP profit to sales ratio has been negatively affected by increased competition although sales remain steady............................................................................... e. BOPP comes to an agreement with its workers which implies a reduction in the total wage bill but which will not affect the firms output..........................................................

Question 1B

For each component of the ESG framework, identity three factors each that Benso Oil Palm Plantation must consider as they revisit their 10-year strategic plan. 3. Korah foods is a tomato paste manufacturing company located in Accra that buys tomatoes in bulk from peasant farmers and processes them into tomato paste for distribution to retail stores. Korahs balance sheet as of December 31st 2020, is shown below GHS GHS Cash 350 Accounts payable 900 Receivables 2600 Accruals 850 Inventories 5800 Notes payable 1800 Total current assets 8750 Total current liabilities 3550 Net fixed assets 3500 Mortgage loan 600 Common stock 1500 Retained earnings 6600 Total assets 12250 Total liabilities and equity 12250

In 2020, the company recorded GHS 3500 worth of sales, which translated into a net income of GHS1050. Korah Foods paid its shareholders dividend amounting to GHS 420. Korah operates in the 35% tax bracket. i) Assuming that sales are projected to increase by 20% in 2021, use the External Financing Needed Equation to determine Korah Foods external financing needed in 2021. ii) Assuming that the financial manager at Korah Foods decides to raise the external financing needed in notes payable, generate Korah Foods balanced pro-forma balance sheet for 2021. Note that the financial manager has also decided that the notes payables will be added when the year ends and as a result there will be no need to account for additional interest expense arising from this debt.