# Sheet1 #1 what we know-balance sheet as of dec 31st 2012 shown in

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Sheet1 #1 What we know-Balance sheet as of Dec 31st 2012 shown in millions Cash 3.50 Accounts payable 9.00 Receivables 26.00 Notes payable 18.00 Inventories 58.00 Accruals 8.50 Total current assets 87.50 Total current liabilities 35.50 Net fixed assets 35.00 Mortgage loan 6.00 Common stock 15.00 Retained earnings 66.00 Total assets 122.50 Total liabilities and equity liabilities 122.50 Sales for 2012 were \$350 million and net income for the year was \$10.5 million, so the firm’s profit margin was 3%. They paid dividends of \$4.2 million to common stockholders, so its payout ratio was 40%. It tax rate is 40% and it opened at full capacity. Assume that all assets/sales ratios, spontaneous liabilities/sales ratios, the profit margin, and the payout ratio remain constant in 2013. a. If sales are projected to increase by \$70 million, or 20%, during 2013, use the AFN equation to determine their projected external capital requirements. b. Using the AFN equation determine the self-supporting growth rate. What is the maximum growth rate the firm can achieve without having to employ nonspontaneous external funds? c. Use the forecasted financial statement method to forecast their balance sheet for December 2013. What is the amount of notes payable reported on the 2013forecasted balance sheet? #2 Balance sheet as of Dec 31st 2012 in thousands Cash 1080.00 Accounts payable 4320.00 Receivables 6480.00 Accruals 2880.00 Inventories 9000.00 Notes payable 2100.00 Total current assets 16560.00 Total current liabilities 9300.00 Net fixed assets 12600.00 Mortgage bonds 3500.00 Common stock 3500.00 Retained earnings 12860.00 Total assets 29160.00 Total liabilities and equity 29160.00 Income statement for Dec 31 2012 in thousands Sales 36000.00 Operating costs 32440.00 Earnings before interest and taxes 3560.00 Interest 460.00 Earnings before taxes 3100.00 Taxes (40%) 1240.00 Net…

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