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Last year, Software International had sales of $10,000,000, and expects a 40% increase in sales next year.Balance sheet items for Software International vary directly with

Last year, Software International had sales of $10,000,000, and expects a 40% increase in sales next year.Balance sheet items for Software International vary directly with sales increases as:

Cash Accounts receivable Inventory Accounts payable Other accruals
7.3% 29.1% 11% 21% 7%

Net fixed assets does not follow sales, but the firm will spend $1.1 million next year to expand its office space. The firm's net profit margin is 9%, and it pays out an annual cash dividend equal to 30% of net income. Create a pro forma balance sheet for next year assuming a 40% increase in sales and that any additional financing needed will be provided byfirstdrawing down their money market account, and if more is needed,increasing theirshort-term loan.

LATEST BALANCE SHEET

Assets Liabilities and Owners' Equity
Cash $ 304,836 Accounts payable $1,260,433
Money market 454,937 Accruals 711,605
Accounts receivable 2,200,522 Short-term loan 0
Inventory 1,541,670 Total current liabilities $1,972,038
Total current assets $4,501,965
Long-term debt $2,800,000
Net fixed assets 2,695,486 Stockholders' equity 2,425,413
Total assets $7,197,451 Total liabilities and equity $7,197,451
T/F

Short-term loan is expected to be $539,063

T/F

Total current liabilities is expected to be $3,631,101

T/F

Stockholders' equity is expected to be $3,307,413

T/F

Additional financing needed is expected to be $994,000

A stock is selling for $38.25, and a put option on that stock with a strike price of $40 is selling for $1.76. What is thebestestimate of the put option's remaining time until expiration?

Last year, Software International had sales of $10,000,000, and expects a 40% increase in sales next year.Balance sheet items for Software International vary directly with sales increases as:

Cash Accounts receivable Inventory Accounts payable Other accruals
7.3% 29.1% 11% 21% 7%

Net fixed assets does not follow sales, but the firm will spend $1.1 million next year to expand its office space. The firm's net profit margin is 9%, and it pays out an annual cash dividend equal to 30% of net income. Create a pro forma balance sheet for next year assuming a 40% increase in sales and that any additional financing needed will be provided byfirstdrawing down their money market account, and if more is needed, increasing theirshort-term loan.

LATEST BALANCE SHEET

Assets Liabilities and Owners' Equity
Cash $ 304,836 Accounts payable $1,260,433
Money market 454,937 Accruals 711,605
Accounts receivable 2,200,522 Short-term loan 0
Inventory 1,541,670 Total current liabilities $1,972,038
Total current assets $4,501,965
Long-term debt $2,800,000
Net fixed assets 2,695,486 Stockholders' equity 2,425,413
Total assets $7,197,451 Total liabilities and equity $7,197,451
T/F

Inventory is expected to be $1,981,670

T/F

Total current assets is expected to be $5,943,028

T/F

Total assets is expected to be $9,738,514

T/F

Accruals is expected to be $991,605

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