Question 16 (5 points) Listen What is the PLUG in 2020? 328 -328 267 -267 View hint for Question 16 Question 17 (5 points) Listen What is the proforma line of credit (short-term bank loan) in 2020? 267 245 0 326 PROFORMA ASSUMPTIONS Below is GAP Inc.'s financial statements for 2018 and 2019 Proforma is 2020. Due to Covid-19 pandemic. GAP Inc expects that sales growth in 2020 will be 1330. Regardless of lower than expected sales growth. GAP Inc. is planning to expand its operations to new cities in 2020). Por the planned expansion, GAP Ine received $1.700 additional long-term loan from J.P. Morgan Chase and will use this loan to finance the purchase of a new office building. Salaries are expected be $113. The market conditions will lend COGS will be 10 percent lower than the 2019 lovel. When projecting the 2020 balance sheet, GAP Inc. believed that the accounts receivable days will be 7 days higher than ACP days of last year Inventory days and accounts payable amount will remain unchanged from 2019 since the business has recently been rewarded with extended payment terms from its suppliers going forward. Current maturities (CMLID), minimum cash ratio and dividend payments will remain samens in 2019. Thx rate is 14%. Interest rate for long-term loan in 2020 is projected to be 49. Interest expense on short term debt is delayed until 2021 (this means apply the interest rate only on long-term debt). Rental expense would be 56 a month Depreciation expense would be the same percentage of gross fixed assets as was in 2019. With these expectations proform Net Income will be $794 INCOME STATEMENT Net sales Cost of goods sold Salaries Rental expenses Depr. Expense Interest expense Tax expense Net income (loss) 2018 1,316 332 90 26 12 560 48 248 2019 1,658 673 100 18 30 338 71 428 BALANCE SHEET Cash Accounts receivable Inventory Total Current Assets GFA Accd depre Net fixed assets Total Assets Accounts payable Bank line of credit Current portion due on term loan Total Current Liabilities Long term debt Total Liabilities Total equity Total Liabilities and Equity 2018 2019 26 20 72 82 85 78 183 180 1,138 1,575 110 140 1,028 1,435 1,211 1,615 39 52 0 225 70 70 109 347 875 805 984 1,152 227 463 1.211 1,615 Formula sheet Question 16 (5 points) Listen What is the PLUG in 2020? 328 -328 267 -267 View hint for Question 16 Question 17 (5 points) Listen What is the proforma line of credit (short-term bank loan) in 2020? 267 245 0 326 PROFORMA ASSUMPTIONS Below is GAP Inc.'s financial statements for 2018 and 2019 Proforma is 2020. Due to Covid-19 pandemic. GAP Inc expects that sales growth in 2020 will be 1330. Regardless of lower than expected sales growth. GAP Inc. is planning to expand its operations to new cities in 2020). Por the planned expansion, GAP Ine received $1.700 additional long-term loan from J.P. Morgan Chase and will use this loan to finance the purchase of a new office building. Salaries are expected be $113. The market conditions will lend COGS will be 10 percent lower than the 2019 lovel. When projecting the 2020 balance sheet, GAP Inc. believed that the accounts receivable days will be 7 days higher than ACP days of last year Inventory days and accounts payable amount will remain unchanged from 2019 since the business has recently been rewarded with extended payment terms from its suppliers going forward. Current maturities (CMLID), minimum cash ratio and dividend payments will remain samens in 2019. Thx rate is 14%. Interest rate for long-term loan in 2020 is projected to be 49. Interest expense on short term debt is delayed until 2021 (this means apply the interest rate only on long-term debt). Rental expense would be 56 a month Depreciation expense would be the same percentage of gross fixed assets as was in 2019. With these expectations proform Net Income will be $794 INCOME STATEMENT Net sales Cost of goods sold Salaries Rental expenses Depr. Expense Interest expense Tax expense Net income (loss) 2018 1,316 332 90 26 12 560 48 248 2019 1,658 673 100 18 30 338 71 428 BALANCE SHEET Cash Accounts receivable Inventory Total Current Assets GFA Accd depre Net fixed assets Total Assets Accounts payable Bank line of credit Current portion due on term loan Total Current Liabilities Long term debt Total Liabilities Total equity Total Liabilities and Equity 2018 2019 26 20 72 82 85 78 183 180 1,138 1,575 110 140 1,028 1,435 1,211 1,615 39 52 0 225 70 70 109 347 875 805 984 1,152 227 463 1.211 1,615 Formula sheet
