P4-18 (similar to)

Pro forma balance

sheetlong dash

Basic

Leonard Industries wishes to prepare a pro forma balance sheet for December 31,

2020

.

The firm expects

2020

sales to total

$ 3 comma 000 comma 000

here is the key

P4-18 (similar to)

Pro forma balance

sheetlong dash

Basic

Leonard Industries wishes to prepare a pro forma balance sheet for December 31,

2020

.

The firm expects

2020

sales to total

$ 3 comma 000 comma 000

.

The following information has been gathered.

(1) A minimum cash balance of

$ 49 comma 600

is desired.

(2) Marketable securities are expected to remain unchanged.

(3) Accounts receivable represent

9.7 %

of sales.

(4) Inventories represent

11.8 %

of sales.

(5) A new machine costing

$ 89 comma 600

will be acquired during

2020

.

Total depreciation for the year will be

$ 31 comma 900

.

(6) Accounts payable represent

14.1 %

of sales.

(7) Accruals, other current liabilities, long-term debt, and common stock are expected to remain unchanged.

(8) The firm's net profit margin is

4.2 %

,

and it expects to pay out

$ 70 comma 300

in cash dividends during

2020

.

(9) The December 31,

2019

,

balance sheet follows

LOADING...

.

a. Use the judgmental approach to prepare a pro forma balance sheet dated December 31,

2020

,

for Leonard Industries.

b. How much, if any, additional financing will Leonard Industries require in

2020

?

Discuss.

c. Could Leonard Industries adjust its planned

2020

dividend to avoid the situation described in part

b?

Explain how.

a. Use the judgmental approach to prepare a pro forma balance sheet dated December 31,

2020

,

for Leonard Industries.

Complete the assets part of the pro forma balance sheet for Leonard Industries for December 31,

2020

below:(Round to the nearest dollar.)

Pro Forma Balance Sheet

.

The following information has been gathered.

(1) A minimum cash balance of

$ 49 comma 600

is desired.

(2) Marketable securities are expected to remain unchanged.

(3) Accounts receivable represent

9.7 %

of sales.

(4) Inventories represent

11.8 %

of sales.

(5) A new machine costing

$ 89 comma 600

will be acquired during

2020

.

Total depreciation for the year will be

$ 31 comma 900

.

(6) Accounts payable represent

14.1 %

of sales.

(7) Accruals, other current liabilities, long-term debt, and common stock are expected to remain unchanged.

(8) The firm's net profit margin is

4.2 %

,

and it expects to pay out

$ 70 comma 300

in cash dividends during

2020

.

(9) The December 31,

2019

,

balance sheet follows

LOADING...

.

a. Use the judgmental approach to prepare a pro forma balance sheet dated December 31,

2020

,

for Leonard Industries.

b. How much, if any, additional financing will Leonard Industries require in

2020

?

Discuss.

c. Could Leonard Industries adjust its planned

2020

dividend to avoid the situation described in part

b?

Explain how.

a. Use the judgmental approach to prepare a pro forma balance sheet dated December 31,

2020

,

for Leonard Industries.

Complete the assets part of the pro forma balance sheet for Leonard Industries for December 31,

2020

below:(Round to the nearest dollar.)

the 2019 balance sheet

Your portfolio has three asset classes. U.S. government T-bills account for

45

%

of the portfolio, large-company stocks constitute another

40

%,

and small-company stocks make up the remaining

15

%.

If the expected returns are

2.00

%

for the T-bills,

10.00

%

for the large-company stocks, and

15.00

%

for the small-company stocks, what is the expected return of the portfolio?

The expected return of the portfolio is

nothing

%.

(Round to two decimal places.)