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Need help with this question? Dahlia Colby, CFO of Charming Florist Ltd., has created the firm's pro forma balance sheet for the next fiscal year.
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Dahlia Colby, CFO of Charming Florist Ltd., has created the firm's pro forma balance sheet for the next fiscal year. Sales are projected to grow by 10 percent to $550 million. Current assets, fixed assets, and short-term debt are 20 percent, 80 percent, and 10 percent of sales, respectively. Charming Florist pays out 25 percent of its net income in dividends. The company currently has $132 million of long-term debt and $60 million in common stock par value. The profit margin is 10 percent. a. Construct the current balance sheet for the firm using the projected sales figure. (Do not round intermediate calculations and enter your answers in dollars, not millions of dollars, rounded to the nearest whole dollar amount, e.g., 1,234,567.) Assets Balance Sheet Liabilities and equity 50,000,000 Short-term debt 400,000,000 Long-term debt Current assets $ $ 50,000,000 132,000,000 Fixed assets $ Common stock Accumulated retained earnings 60,000,000 208,000,000 Total equity 450,000,000 Total liabilities and equity $ $ 268,000,000 450,000,000 Total assets $ b. Based on Ms. Colby's sales growth forecast, how much does Charming Florist need in external funds for the upcoming fiscal year? (Do not round intermediate calculations and enter your answer in dollars, not millions of dollars, rounded to the nearest whole dollar amount, e.g., 1,234,567.) External financing needed C-1. Construct the firm's pro forma balance sheet for the next fiscal year. (Do not round intermediate calculations and enter your answers in dollars, not millions of dollars, rounded to the nearest whole dollar amount, e.g., 1,234,567.) Assets Balance Sheet Liabilities and equity Short-term debt Long-term debt Current assets Fixed assets Common stock Accumulated retained earnings Total equity Total liabilities and equity Total assets C-2. Calculate the external funds needed. (Do not round intermediate calculations and enter your answer in dollars, not millions of dollars, rounded to the nearest whole dollar amount, e.g., 1,234,567.) External financing neededStep by Step Solution
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