Determine the value for external funds needed

Assignment Help Finance Basics
Reference no: EM1358029

Company A forecasts that sales next year will be $5,600. If I assume long-term debt remains constant, what is the value for external funds needed (EFN)? I have the financial statement in for below:

Income statement

Sales
Cost of sales
Depreciation
Interest
Tax (35%) $5,000
3,500
800
200
175
Net income
Dividends $ 325
130

Balance sheet

Current assets
Net fixed assets $ 850
3,275 Current liabilities
Long term debt
Equity $ 320
1,330
2,475
Total $4,125 $4,125

As an extension, If I assume that Company A has sufficient excess capacity to support a sales level of $5,300 with no new fixed assets, what would my EFN for projected sales of $5,600 be?

Continuing the previous problem, Company A believes that an industry slowdown is possible over the next year. In this case, sales growth will be 4%. What is the EFN?

Reference no: EM1358029

Questions Cloud

How much force pulls forward on the rope : A 23 kg body is moving in the direction of the positive x axis with a speed of 292 m/s when, owing to an internal explosion, it breaks into three pieces.
Elucidate how these tendencies lead to religion becoming : Elucidate how these tendencies lead to religion becoming evil, how does Kimball respond to them and how the Greek Orthodox tradition transcends them.
Explain pick one business leader in your community : Explain Pick one business leader in your community and evaluate his performance against the leadership characteristics
Implement a queue as a circular array : Implement a queue as a circular array as follows: Use two index variables head and tail that contain the index of the next element to be removed and the next element to be added.
Determine the value for external funds needed : Corporation A forecasts that sales next year will be $5,600. If I assume long-term debt remains constant, determine the value for external funds needed? I have the financial statement given below:
Trendy technology communication : Technology is changing the face of business communications. Do you think businesses effectively use these resources to communicate? Why or why not? Provide examples.
Physical units-nrv-constant : Bubble Corporation manufactures two products, I and II, from a joint process. A single production costs $4,000 and results in 100 units of I and 400 units of II. To be ready for sale, both products must be processed further, incurring separable co..
Verbally aggressive schizophrenic client : Sometimes I am able to, and at other times I can't even get him to listen to me. Do you have any suggestions on how I can help him when he has those episodes?
Compute the confidence intervals for the expected annual : Using the following table, compute the 95% confidence intervals for the expected annual return of the four different investments.

Reviews

Write a Review

Finance Basics Questions & Answers

  Financial reporting and analysis

Finance is about Gunns Ltd, a company in dealing with forestry products in Australia. The company has also been listed in Australian Stock Exchange. As many companies producing forestry products, even Gunns Ltd is facing various problems. Due to the ..

  A report on financial accounting

This report is specific for a core understanding for Financial Accounting and its relevant factors.

  Describe the types of financial ratios

Describe the types of financial ratios and other financial performance measures that are used during venture's successful life cycle.

  Differences between sole proprietorship and corporation

Briefly describe the major differences between a sole proprietorship and a corporation

  Prepare a cash budget statement

Calculate the expected value of the apartment in 20 years' time. What is the mortgage loan repayment at the beginning of each month

  What are the implied interest rates

What are the implied interest rates in Europe and the U.S.?

  State pricing theory and no-arbitrage pricing theory

State pricing theory and no-arbitrage pricing theory

  Small business administration

Identify the likely stage for each venture and describe the type of financing each venture is likely to be seeking and identify potential sources for that financing.

  Effect of financial leverage

The Effect of Financial Leverage and working capital management

  Evaluate the basis for the payment to the lender

Evaluate the basis for the payment to the lender and basis for the payment to the company-counterparty.

  Importance of opps, ipps, mpfs and dmepos

Research and discuss the differences and importance of : OPPS, IPPS, MPFS and DMEPOS.

  Time value of money

Time Value of Money project

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd