Answered step by step
Verified Expert Solution
Question
1 Approved Answer
QUESTION FOUR (20 MARKS) Piri's dive shop had the following 2019 results: - Sales =$7,200 - Costs =$6,100 - Assets =$18,000 - Debt =$8,000 -
QUESTION FOUR (20 MARKS) Piri's dive shop had the following 2019 results: - Sales =$7,200 - Costs =$6,100 - Assets =$18,000 - Debt =$8,000 - Equity =$10,000 Forecasted sales for 2020 are $8,500. There are no taxes. Assets and costs are proportional to sales. Debt and Equity are not. The retention rate is 100%. What is the AFN (additional funds needed) in 2020 to support forecasted sales of $8,500 ? (Hint: Construct the 2020 balance sheet and find the AFN required to make the balance sheet balance. Also, assume spontaneous liabilities are unchanged from 2019 to 2020 .)
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started