Problem SFP4-2 FINANCIAL PLANNING AND GROWTH CONSIDERATIONS Clueless, Inc. Balance Sheet at 12/31/2019 (000's) Cash & Marketable Securities 60 Accounts Payable 50 Accounts Receivable 111 Long-Term Debt 293 Inventories 150 Total Liabilities 343 Total Current Assets 321 Common Stock 145 Net Fixed Assets 250 Retained Earnings 83 Total Assets 571 Total Liabilities and Capit 571 Additional considerations: Sales for 2019 were $1,000,000; Net Income after Tax = $60,000 Management's estimates for the next years: Sales growth @30% for 2020 Net Income after Taxes estimated at 6% of Sales Proposed Dividend distribution = 40% of after-tax profits Proposed Debt to Assets ratio = 60% Projected Year-End Cash Balance = 6% of Sales Projected Year-End Accounts Receivable Duration = 40 days Projected levels of Inventory = 15% of Sales Projected Accounts Payable levels = 5% of Sales Projected level of Net Fixed Assets = 25% of Sales No projected changes in the levels of Common Stock are proposed Required: Prepare a 2020 projected Income Statement, Balance Sheet and Statement of Cash Identify implications of excessive growth expectations upon capital structure Calculate a more responsible level of growth to avoid financial distress