Ke y AEN Problens for Lab 3 AGEC 424 Adéstional funds needed 1. JAILS Wigs Ine. had the following Lait facler Mec balance sheet last year: cash $ see 2 Mee Accounts payable $. Accounts rec. 450-400 Acecrued wages Inventory sso 2140 notes payable het fived a. daa J 34,080 antago 26,500 — 26500, Common stock 38,800 Total assets $36,200 Retained earnings Total Liabilities and equity ‘3411 has just invented a non-slip wig for men which she expects will cause Sales to double, increasing after-tax net Income to $1,008. She foals that she an handte the increase without adding any fixed assets. (1) will Jil] need ‘any outside capital if she pays no Bi ¥e8: 37,7 ve cw gire eam ty @ vei vio No there will be a $700 sur ‘Additional funds needed 2. You are the omer 2€ a snail business Sheet, Ast ee Merk Current assets $5,000 y4. T50 Net Fixed assets 10,030 15 15000 22500 Total assets 115,00 Fixed and current assets are fully dividends? (2) TF 50, how auch? Nos zero Denble 2 100% inctease => Factor of 2 additinte RE = HE ~% =M,000 BRH00 ates ncude = B77 Financia) 700 AFM 5s which has the Following balance Last fecter Usk Accounts payable $1,009 45 1500 Accruals 1e00 1.8 1580 Long-term debt 5,000 ——> 50s omen equity _8,009 42000 JOH. Total $5,000 (00 plus uti2ized, and the sales/assets and sales/spontancous liabilities ratios will renain constant. Next year you expect sales to increase by $0 percent. You also expect to retain $2,000 of ext year’s earnings within the firs. what 4s next year's additional external ‘Funding requirenent, f.0., what is No additional funds are requs $3,500 ‘4,500 $5,500 ‘Te answer depends on this yé 22500 - 18000 = Your fires AP Sales factor 1-5. Capacity wse x Sater forte = OX 15 = MS facher for fives jar's sales level. hety 4500 AFIS fred.‘aditional funds needed 3. A Firm has the follosing balance sheet: Last Sidhe yaks Last fut Bat Fixed assets we Ey Conmon stock we—> %o = Q. See ee BNI and equity s209 oval euats ay3 ANG) SS ithe yr it endl wae on, an ud ates ir ad a 9 pA Feretn of caplet be les curren esets nare a open weiss See are pected fo grav 6) 5 percnt nent Your; tie profit eargin ds perenty ad = tay sense alvind pape Fale €b percent. tou mock atsiioal feds (A) wh encoded? Surplus Ae peeeay aan Of G# GD AEE coupuusy YE? Px Sater > .05xda0 =a eo oe ee ane ae a $8.6 (suptusy © $9.8 BXN0S 2 84 Cotte at SH OF Caracity «| de net Meee more Pye danets) Financing requirenents 4. A firm has the following belance sheet: last fad Ye tast factor Youd cash $10 “Ga (2 Accounts payable sw ia 2 Accounts rec. 18 AZ IZ Notes payable »—> @ Inventories 10 5212 Longeterm debt o— * Fixed assets 90 |< comon stock a> _ Pao _ Retained earnings _ + 28) Total assets $128 Total Liab. and equity $120 42 Fixed assets are being used at 99 percent of capacity in the year just ended; sales for the year just ended were $280; sales will increase $10 per year for the next 4 years, the profit margin is § percent; and the divicend payout ratio 1s 60 pereint. Assume that ited assets cannot be sold. What are the JAG total external financing requirenents for the entire 4 years, Sue., the total oo mtcaraaen on a Sdevfuce, 2B 22 20% hora =H4 hee $4 ot ae. ' eplus iy “$0.88 (Surplus BXLZ 90 (uses Reter Sup ED “putts (Grou = 220 eae of He 3 abo x 4 20 GS8e45 of fo) Foo x.05 2 4S wediobome rekentannele 2 7B rebained efeningy