90 Part Two Planning Fiahure Financial Performance TABLE 3.5 Forecasting with a
ID: 2510954 • Letter: 9
Question
90 Part Two Planning Fiahure Financial Performance TABLE 3.5 Forecasting with a Spreadsheet: Pro Forma Financial Forecast for R&E; Supplies, Inc.. December 31,2018 (S thousands) 2018 2019 2017 Actual $20,613 Year 3 Net sales 4 Growth rate in net sales 5 Cost of goods sold/net sales 6 Gen sell., and admin, expenses/net sales 7Long-term debt 8 Current portion long-term debt 9 Interest rate 10 Tax rate 11 Dividend/earnings after tax 25.0% 86.0% 12.0% $660 $100 10.0% 45.0% 50.0% 29.0% s 760 $ 100 Current assets/net sales 13 Net fixed assets 14 Current liabilities/net sales $280 14.5% 16 INCOME STATEMENT Equations Forecast Forecast 2018 2018 2019 19 Net sales 20 Cost of goods sold 21 Gross profit 22 Gen., sell, and admin. exp. 23 Interest expense 24 Earnings before tax B34 B3104 C5"? 19 $25,766 22,159 3.607 3,092 231 285 128 156 78 78 =C19-C20 C6C19 C9C7+ C8+C40) - C21-C22 - C23 Tax 26 Earnings after tax 27 Dividends paid 28 Additions to retained earnings ? 10"C24 C24-C25 C11 C26 C26-C27 30 BALANCE SHEET 31 Current assets 32 Net fixed assets 33 Total assets C12"C19 C13 7.472 280 752 -C31+C32 35 Current liabilities 36 Long-term debt 37 Owners' equity 38 Total liabilities and owners C14'C19 B15 + C28 C35 + C36 + C37 3,736 660 1,808 6,204 equity 40 EXTERNAL FUNDING REQUIRED - C33-C38 $ 1,548Explanation / Answer
Year 2017 Actual 2018 2019 Net Sales 20613 Growth Rate in net sales 25% 25% Cost of goods / net sales 86% 86% Ge.,Selling and Adm. Expenses / Net Sales 12% 12% Long-term debt 760 660 560 Current portion of long-term debt 100 100 100 Interest Rate 10% 10% Tax Rate 45% 45% Dividends/earning after tax 50% 50% Current assets / net sales 29% 29% Net Fixed Assets 280.00 280.00 Current liabilities / net sales 14.50% 14.50% Owners' equiy 1730 Income Statement Year Equations ForeCast ForeCast Equations 2018 2019 Net Sales 25766 32208 c19+c19*d4 Cost of goods sold 22159 27699 C9*d5 Gros Profit 3607 4509 Gen.,selling and admn. Expenses 3092 3865 Interest Expense 231 315 Earnings before tax 285 329 Tax 128 148 Earnings after tax 156 181 Dividends Paid 78 90 Addition to retained earnings 78 90 Balance Sheet Current Assets 7472 9340 Net Fixed Assets 280 280 Total Assets 7752 9620 Current Liabilities 3736 4670 Long-term Debt 660 560 Total Liabilities 4396 5230 Owners' Equity 1808 1898 C38+d28 Total liabilities and owners' equity 6204 7128 External funding required 1548 2492
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