Question
Bill Inc.'s last year financial statements are shown below: Bill Inc. Balance Sheet as of December 31 Cash $ 90,000 Accounts payable $ 180,000 Receivables
Bill Inc.'s last year financial statements are shown below: Bill Inc. Balance Sheet as of December 31
Cash $ 90,000
Accounts payable $ 180,000
Receivables 180,000
Notes payable 78,000
Inventory 360,000
Accruals 90,000
Total current assets $ 630,000
Total current liabilities $ 348,000
Common stock 900,000
Net fixed assets 720,000
Retained earnings 102,000
Total assets $1,350,000
Total liabilities and equity $1,350,000
Bill Inc. Income Statement for December 31
Sales $1,800,000
Operating costs 1,639,860
EBIT $ 160,140
Interest 10,140
EBT $ 150,000
Taxes (40%) 60,000
Net income $ 90,000
Dividends (60%) $ 54,000
Addition to retained earnings $ 36,000 Suppose that next year's sales will increase by 20 percent over last year's sales. Assume that fixed assets are only being operated at 95 percent of capacity. Construct the proforma financial statements using the percent of sales method. Assume that there are no financing feedback, i.e., interest expense stays the same. How much additional capital will be required?
A. a. $73,218 B. b. $85,201 C. c. $91,873 D. d. $100,800 E. e. $129,113
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The Legal Environment Today Summarized Case Edition
Authors: Roger LeRoy Miller
8th Edition
130526276X, 978-1305279407, 1305279409, 978-1305704930, 1305704932, 978-1305262768
