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Louie is forecasting his financial statements for next year. He is finished with his income statement, but needs your help on his balance sheet. Based
Louie is forecasting his financial statements for next year. He is finished with his income statement, but needs your help on his balance sheet. Based on the following information, how much additional financing (borrowing) or excess financing should Louie plan on for his business in 2017? Louie does not anticipate selling any stock in 2017.
A. 2000 Excess
B. 2000 Borrowing Needed
C. 1000 Excess
D. 1000 Borrowing Needed
Income Statement | Pro-Forma 2017 | Balance Sheet | 2016 | Pro-Forma 2017 | |
Sales | 100,000 | Current Assets | 5,000 | 6,000 | |
Less: COGS | 80,000 | Net Fixed Assets | 6,000 | 5,500 | |
Gross Profit | 20,000 | Total Assets | 11,000 | 11,500 | |
Less: Operating Expenses | 5,000 | ||||
EBT | 15,000 | Current Liab | 8,000 | 7,500 | |
Less: Taxes @40% | 6,000 | Owner's Eq | 3,000 | ||
Net Profit After Tax: | 9,000 | Total Liab & Owner's Eq | 11,000 | ||
Dividends Paid | 6,000 |
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