David M., the CFO of Berkeley Company, has created the firm s pro forma balance sheet...
David M., the CFO of Berkeley Company, has created the firm s pro forma balance sheet for the next fiscal year. Sales are projected to grow by 12 percent to $49 million. Current assets, fixed assets, and short-term debt are 22 percent, 64 percent, and 15 percent of sales, respectively. Berkeley Company pays out 35 percent of its net income in dividends. The company currently has $14.4 million of long-term debt and $16.2 million in common stock par value. The profit margin is 10 percent. Based on the CFO s sales growth forecast, how much does Berkeley Company need in external funds for the upcoming fiscal year? (Hint: you need to construct the balance sheet this year and determine the accumulated retained earnings before constructing the proforma balance sheet to determine the EFN)
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$1.27 million |
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$1.45 million |
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$0.54 million |
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$0.36 million |
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$0.91 million |
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David M., the CFO of Berkeley Company, has created the firm s
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