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    Additional Funds Needed (AFN)

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    Suppose net income for the coming year is forecasted to be $1,634 and dividends are forecasted to be $657. After careful analysis, you determine asset needs for next year are $48,824 and liabilities are expected to be $12,869. Owner's equity of the year just completed was $9,040. Calculate the additional funds needed or generated for the coming year.

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    Solution Preview

    The funds are needed for the assets. A part of the funding comes from the liabilities and from the retained earnings. The balance is the additional funds needed.

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    Solution Summary

    The solution explains how to calculate the additional funds needed