Grow in proportion to projected sales

Assignment Help Financial Management

Reference no: EM13971957

Carter Corporation's sales are expected to increase from $5 million in 2012 to $6 million in 2015, or by 20%. Its assets totaled $3 million at the end of 2014. Carter is at full capacity, so its assets must grow in proportion to projected sales. At the end of 2014, current liabilities are $1 million, consisting of $250,000 of accounts payable, $500,000 of notes payable, and $250,000 of accrued liabilities. Its profit margin is forecasted to be 4%, and the forecasted retention ratio is 25%. Use the AFN equation to forecast the additional funds Carter will need for the coming year.

Reference no: EM13971957

Questions Cloud

Explain the tax consequences : Your client supplies water to a housing development. The company requires new customers to pay for the extension of the water lines to their homes. The water lines are the company's property. The client would like you to explain the tax consequences ..

Seeking foreign direct investment opportunities : What country(ies) do you think is(are) presently attractive for U.S. corporations seeking foreign direct investment opportunities? Take into account any geopolitical/economic/currency risks you are aware of.

Determine youngs earnings for each day and for the week : Determine Young's earnings for each day and for the week. Prepare the journal entry to distribute the payroll, assuming that any make-up guarantees are charged to Factory Overhead.

Calculating the ROE-ROA-profit margin and equity multiplier : For this assignment you will conduct a comparative DuPont analysis of two companies. Using a search engine, find one large corporation included in the S & P 500. Then, find one of its largest competitors. Go to the investor relations portion of each ..

Grow in proportion to projected sales : Carter Corporation's sales are expected to increase from $5 million in 2012 to $6 million in 2015, or by 20%. Its assets totaled $3 million at the end of 2014. Carter is at full capacity, so its assets must grow in proportion to projected sales. Use ..

What is the average amount of receivables : McDowell Industries sells on terms of 3/10, net 40. Total sales for the year are $1,633,000; 40% of the customers pay on the 10th day and take discounts, while the other 60% pay, on average, 68 days after their purchases. What is the average amount o..

Preparing a time-phased budget baseline : Assume that you are the project manager for the construction of 10 conference facilities in your organization’s building in Florida. A statement of work has been given to you, and contracts have already been awarded. What difficulties did you have in..

Prepare a statement of stockholders equity for the year : Prepare a summarized income statement for the year 2014. HIGHLIGHT CONSTRUCTION COMPANY Income Statement For the Year Ended December 31, 2014 Total sales revenue $128,400 Total sales revenue 80,200 Inventory of merchandise 2. Prepare a statement of s..

Expound on advantages-disadvantages of EPS-ROE and P-E ratio : The P/E ratio for Lemanowicz and Associates is 10. We know that EAT, book value of equity, sales, total assets and number of shares of the firm are $10 m, $30m, $50 m, $100m and I million respectively. What is the EPS, ROE and BVPS? What is a reasona..

User Account

All Pages