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    Additional Funds Needed for ABC Corporation's

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    The 1999 Balance Sheet for ABC Corporation is shown below:

    Assets 1999 Liabilities 1999

    Cash $10,000 Accounts Payable $ 8,000
    Accounts Receivable 20,000 Accruals 2,000
    Inventory 40,000 Total Current Liabilities $10,000
    Total Current Assets $70,000 Bonds $30,000
    Net Fixed Assets $150,000
    Total Liabilities $40,000

    Owners Equity

    Common Stock $100,000
    Retained Earnings 80,000
    Total Assets $220,000 Total Liab.& OE $220,000

    The firm is currently operating at 100% capacity with sales of $100,000. Management believes that next year sales will increase by 10% and it is anticipating that the firm's profit margin will remain at 20%. The dividend payout for next year will be 45%. In the year 2,000 what will the firm's additional funds needed be? (In answering this question you must prepare a pro forma balance sheet.)

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    Solution Summary

    The solutoin helps in preparing the Pro Forma Balance Sheet and Additional Funds Needed for ABC Corporation's