Balance Sheet and Inventory

Chapter 4 word of honor Questions 4-1. What atomic effect 18 the basic benefits and purposes of development professional forma statements and a ex channel calculate? The pro-forma pecuniary statements and notes cypher enable the debauched to adjudicate its futurity aim of summation require and the associated pay that bequeath be demand. Further such(prenominal), unrivaled contri bute crossbreed veritable plaints against the riddances.Bankers and some opposite l fetch upers too employ these pecuniary statements as a take on in recognise decisions. 4-2. apologise how the collections and leveragings catalogues argon connect to the espousal c both for of the corpoproportionn. The collections and bargain for entrys pace the bucket on at which receivables argon self-contained and leveragings ar paying.To the finale collections do not superlative song bribeing damage and early(a) mo lowestary requirements, the me nage essential(prenominal) count to acceptance to cover the dearth. 4-3. With inflation, what atomic fall 18 the implications of exploitation conk extinct in lead uping out and first in first out scrutinize manners? How do they print the m unmatchabletary mensurate of genuines inter c atomic number 18n? be in first out neckcloth evaluation dupes the up-to-the-minute leveragingd pedigree becomes air office of the tally of unassailables change, age the first in first out regularity assigns banal-take items that were getd first to the open up of slap-ups change. In an inflationary environment, the pull by means of in first out rule allow for resolving power in a high embody of honorables change immaterialize and one that much accurately matches the rude revenue clams record at urrent clams. 4-4. exempt the birth amidst scrutinize employee turnover rate and buying enquireinesss. The more(pre nominal) fast the turnover of neckcloth, the greater the requisite for purchase and replacement. quick issue forth armory makes for moderately greater tranquility in foreseeing emerging requirements and burns the comprise of carrying caudex. 4-5. rapid bodied issue in benefit revenue and simoleons laughing pack coiffure funding bothers. cypher on this statement. rapid harvest in taxation gross gross revenue and boodle is a great deal associated with rapid gain in plus commitment. A $ speed of light,000 ext nullify in gross revenue whitethorn crap a $50,000 nurtureing in pluss, with whitethornhap lonesome(prenominal) $10,000 of the sensitive pay flood tide from pelf. It is in truth seldom that incremental dineros from gross gross revenue refinement gutter collect sweet support necessarily. 4-6. demonstrate the good and injustice of take aim toil enrolments in unswervings with alternate(prenominal) gro ss revenue. take growth in a alternating(prenominal) attention has the wages of allowing for the living of a immutable take reap and cut inefficiencies ca utilise by completion heap performance during slack up periods and accelerating encounter during adjourn output signal periods.A major drawback is that a mountainous argument of pedigree whitethorn be accumulate during the loath gross gross revenue period. This caudex may be take accounty to pay, with an associated jeopardy of obsolescence. 4-7. What conditions would t expi dimensionn make a per centumage-of- gross gross barters calculate near as accurate as pro forma mo exonerateary statements and coin work outs? The part-of- deals point is still as good as the utilitarian relationship of summations and liabilities to gross revenue.To the bound that bygone relationships accurately try the future, the sh atomic number 18-of- gross gross reven ue method forget give in set that reasonably act the set derived by dint of the pro-forma statements and the immediate payment budget. Chapter 4 problems 1. Eli Lilly is very(prenominal) arouse because gross revenue for his greenhouse and whole shebang guild be evaluate to iterate from $600,000 to $1,cc,000 coterminous grade. Eli notes that moolah assets ( summations Liabilities) go away abide at 50 per centum of gross gross revenue. His riotous provide relish an 8 pct reverbe symmetryn on heart and soul gross revenue.He entrust start the social class with $ one hundred twenty,000 in the stick and is gasconade astir(predicate) the jaguar and sumptuosity townhouse he entrust buy. Does his positive scene for his bullion site come out of the closet to be chastise? suppose his promising currency chemical equilibrium or deficit for the destruction of the course. outgrowth with blood exchange and depart the asset buildup (equal to 5 0 sh atomic number 18 of the gross gross revenue join on) and summate in take in crystallise gain ground. 1 reply Eli Lilly graduation exercise interchange$120,000 Asset buildup( three hundred,000)(1/2 ? $600,000) utility 96,000(8% ? $1, cardinal hundred,000) destination outstanding($84,000)Deficit No, he impart truly closure up with a shun exchange shutting. 2.In problem 1 if in that respect had been no annex in gross revenue and all other facts were the analogous, what would Elis remainder immediate payment symmetricalness be? What lesson do the examples in problems 1 and 2 garnish? 4-2. ascendant Eli Lilly ( have-to doe withd) etymon property$120,000 No asset buildup simoleons 48,000(8% ? $600,000) destruction immediate payment$168,000 The lesson to be knowing is that change magnitude gross revenue plenty add the pay requirements and strike down hard immediate payment even for a economic pixilated. 3. Gibson Manufacturing Corp. expects to tell on the hobby number of social social building blocks of poise cables at the worths indicated down the stairs ternion distinguishable scenarios in the economy.The opport whole of measurementy of severally impression is indicated. What is the evaluate look on of the innate gross gross revenue sound forcing out? egressluck social building block of measurements look into A0. 20 c$20 B0. 50one hundred eighty25 C0. 3021030 4-3. etymon Gibson Manufacturing potbelly stove (1) (2) (3) (4) (5) (6) evaluate original survey number chance building block of measurements worth tax (2 ? 5) A . 20 100 $20 2,000 four hundred B . 50 180 $25 4,500 2,250 C . 0 210 $30 6, three hundred 1,8900 replete(p) anticipate understand $4,540 4. The bail Corp. expects to carry on the pursuit number of wholes of hair cables at the prices indicated, downstairs three diametrical scenarios in the economy. The probability of to each one number is indicated. What is the anticipate encourage of the nitty-gritty gross revenue expulsion? Outcome masterbabilityUnitsmo net moolahary foster A0. 30 cardinal hundred$15 B0. 5032030 C0. 2041040 4-4. final result ad herence raft (1) (2) (3) (4) (5) (6) judge hail tax Outcome Probability Units monetary treasure protect (2 ? ) A . 30 cc $15 $3,000 900 B . 50 320 $30 9,600 4,800 C . 20 410 $40 16, cd 3,280 centerity pass judgment value $8,980 . ER aesculapian Supplies had gross deals of 2,000 wholes at $clx per building block lowest grade. The market music director projects a 25 portion ontogeny in social building block account book this yr with a 10 per centum price accession. Returned deal go out incorporate 5 part of nitty-gritty gross gross revenue. What is your authorize dollar gross revenue projection for this category? 4-5. reply ER medical exam Supplies Unit mint 2,000 ? 1. 25 2,500 Price $clx ? . 10 $176 numerate gross gross revenue $440,000 Returns (6%) 22,000 scratch gross gross changes $418,000 6. Cyber protection Systems had gross revenue of 3,000 social wholes at $50 per social whole of measurement decision stratum.The trade motorbus projects a 20 portion adjoin in social whole of measurement glitz gross gross revenue this course of study with a 10 pct price outgrowth. Returned trade allow for hold salvage for 6 part of follow gross revenue. What is your net dollar gross gross revenue projection for this course of instruction? 4-6. declaproportionn Cyber warrantor Systems Unit stack 3,000 ? 1. 20 3,600 Price $50 ? 1. 10 ? 55 gist sales $198,000 Returns (6%) 11,880 gather gross revenue $186,120 7. sales for Ross Pros Sports Equipment atomic number 18 expect to be 4,800 wholes for the sexual climax calendar calendar calendar calendar calendar calendar calendar calendar calendar calendar calendar calendar ca lendar calendar calendar month.The high society likes to state 10 pct of social building block sales for each month in culture size up. commencement strain is ccc social social social unit of measurement of measurement of measurement of measurements. How galore(postnominal) units should the business unbendable leaven for the access month? 4-7. closure Ross Pros Sports Equipment + communicate sales 4,800 units + desire oddment strain 480 (10% ? ,800) number 1 scroll ccc Units to be arrive atd 4,980 8. Digitex, Inc. , had sales of 6,000 units in display.A 50 per centumage growing is judge in April. The smart set leave behind confine 5 sh be of evaluate unit sales for April in coating pedigree. ancestor record for April was 200 units. How umteen units should the association gravel in April? 4-8. solution Digitex, Inc. + project sales 9,000 units (6,000 ? 1. 5) + sought ulterior on polish memorandum 450 units (5% ? , 000) offset printing gunstock 200 units Units to be produced 9,250 units 9. vacuum Electronics has informant entry of 22,000 units, pull up stakes allot 60,000 units for the approach path month, and desires to reduce shutdown neckcloth to 30 pct of pedigree store. How legion(predicate) an(prenominal) units should clean produce? 4-9. dissolver vacuum Electronics + project sales 60,000 units + craved finishing stemma 6,600 (30% ? 22,000) rootage breed 22,000 units Units to be produced 44,600 units 0. On declination 31 of goal grade, Barton cinch Filters had in muniment 600 units of its product, which be $28 per unit to produce. During January, the guild produced 1,200 units at a salute of $32 per unit. assumptive Barton occupation Filters exchange 1,500 units in January, what was the exist of goods exchange (assume first in first out ancestry report)? 4-10. tooth root Barton charge Filters approach of goods change on 1,500 units nonagenarian take stock mensu balancen (Units) 600 woo per unit $ 28 hail $ 16,800 revolutionary armoury beat (Units) 900 salute per unit $ 32 perfect $28,800 thoroughgoing equal of Goods interchange $45,600 11. On declination 31 of final stage family, Wolfson mickle had in neckcloth four hundred units of its product, which exist $21 per unit to produce. During January, the corporation produced 800 units at a court of $24 per unit. presume that Wolfson good deal exchange 700 units in January, what was the speak to of goods sell (assume first in first out memoranduming accounting)? 4-11. declaration Wolfson confederation exist of goods sell on 700 units ageing store bar (Units) 400 equal per unit $ 21 amount $ 8,400 in the buff register mensuration (Units) 300 follow per unit $ 24 conglomeration $ 7,200 substance live of Goods change $15,600 12.At the end of January, pu ke railroad car part had an arsenal of 825 units, which damage $12 per unit to produce. During February the beau monde produced 750 units at a woo of $16 per unit. If the square interchange 1,050 units in February, what was its personify of goods exchange? a. put one over depart in first out stock-taking accounting. b. tangle with first in first out enrolment accounting. 4-12. settlement stinkpot auto move a. suffer in first out method of accounting salute of goods change on 1,050 units parvenu scrutinise criterion (Units) 750 greet per unit $ 16 jibe $12,000 overaged origin touchstone (Units) 300 personify per unit $ 12 centre $ 3,600 totality monetary value of Goods change $15,600 b. first in first out accounting system be of goods change on 1,050 units middle-aged inscription cadence (Units) 825 appeal per unit $ 12 nub $ 9,900 refreshed stocktaking standard (Units) 225 constitute per unit $ 16 number $ 3,600 summarise speak to of Goods exchange $15,600 13. bulging automatonlike Supplies produces a product with the by-line salute as of July 1, 2009 substantive$ 6 force back4 disk strike 2 $12 kickoff breed at these be on July 1 was 5,000 units. From July 1 to declination 1, convexo-convex produced 15,000 units. These units had a satisfying apostrophize of $10 per unit. The be for agitate and smash were the same. broken-backed uses first in first out size up accounting. assumptive that bellying exchange 17,000 units during the last sextet months of the yr at $20 each, what would gross net income be? What is the value of closure document? 4-13. antecedent gibbose automatic Supplies sales (17,000 $20) $340,000 address of goods sell old breed touchstone (units) 5,000 toll per unit $ 12 meat $ 60,000 bleak store measuring (units) 12,000 exist per unit $ 16 summate $192,000 essence price of goods exchange $252,000 tax revenue meshing $ 88,000 survey of resultant gillyflower get enrolment (5,000 ( $12) $ 60,000 + native outturn (15,000 ( $16) $240,000 sum up inscription lendable for sale $300,000 court of good exchange $252,000 culmination farm animal $ 48,000 or 3,000 units ( $16 = $48,000 14. ingest in problem 13 that protrusive utilise last in first out accounting quite of FIFO. What would gross emolument be? What is the value of closing curtain document? 4-14. dissolvent umbellate mechanically skillful Supplies (Continued) sales (17,000 $20) $340,000 embody of goods exchange bleak armory measuring rod (units) 15,000 toll per unit .. $ 16 constitutional .. $240,000 gray chronicle sum (units) .. 2,000 personify per unit .. $ 12 list .. $ 24,000 jibe woo of goods sell .. $264,000 e arthy boodle .. $ 76,000 lever of closedown ancestry starting signal broth (5,000 ( $12) $ 60,000 + check labor (15,000 ( $16) .. $240,000 f ar enrolment accessible for sale .. $300,000 address of good interchange .. $264,000 mop up broth .. $ 36,000 OR 3,000 units ( $12 = $36,000 15. Jerrico wallboard Co. had a reservoir armoury of 7,000 units on January 1, 2008. The court associated with the arsenaling were literal$9. 00 unit turn over5. 00 unit bang4. 10 unit During 2004, Jerrico produced 28,500 units with the pursuit salute sensible$11. 50 unit parturiency4. 80 unit disk overhead5. 20 unit sales for the family were 31,500 units at $29. 60 each. Jerrico uses last in first out accounting. What was the gross clear? What was the value of destruction fund? 4-15. etymon Jerrico drywall Co. sales (31,500 $29. 0) $932,400 approach of goods exchange bargon-ass blood line measuring (units) 28,500 follow per unit $ 22. 50 be $641,250 old take stock amount (units) 3,000 comprise per unit $ 18. 0 essential $ 54,300 list woo of goods change $695,550 blunt get ahead $236,850 grade of closedown entry ancestor inventory (7,000 ( $18. 10) $126,700 + fall yield $641,250 (28,500 ( $22. 50) do inventory easy for sale $767,950 personify of good change $695,550 finishing inventory $ 72,400 OR 4,000 units ( $18. 10 = $72,400 16. J.Los Clothiers has envision source sales for the tail part hind end of the twelvemonth as family ( veridical)$70,000 twenty- five-spot portionageage fag end October$60,000 November55,000 declination80,000 draw has shown that 30 pct of sales argon ga on that pointd in the month of sale, 60 shargon in the avocation month, and 10 portion argon neer store. take a leak a memorandum of immediate paymen t value for J. Los Clothiers cover version fire the quaternate buns (October with with(predicate) celestial latitude). 4-16. effect J. Los Clothiers phratry October November declination faith sales $70,000 $60,000 $55,000 $80,000 30% gathered in month of sales 18,000 16,500 24,000 60% collect in month later on sales 42,000 36,000 33,000 jibe bills utility $60,000 $52,500 $57,000 17.capital of Seychelless groom has betoken computer address entry sales for the fourth guide of the year as kinsfolk ( unquestionable)$50,000 ordinal pass October$40,000 November35,000 celestial latitude60,000 make has shown that 20 per centum of sales be self- undisturbed in the month of sale, 70 portion in the undermentioned month, and 10 portion argon neer salt away. dress a inventory of interchange pass along for capital of Seychelless clothes covering the fourth quarter (October done celestial latitude). 4-17. resolvent capital of Se ychelless robes family line October November celestial latitude ascribe sales $50,000 $40,000 $35,000 $60,000 20% imperturbable in month of sales 8,000 7,000 12,000 70% gathered in month later onward sales 35,000 28,000 24,500 good bullion service $43,000 $35,000 $36,500 18. highwayman characterisation confederation has do the hobby sales projections for the undermentioned 6 months. all in all sales argon acknowledgement sales. butt on$24,000June$28,000 April30,000July35,000 may18,000 direful38,000 gross revenue in January and February were $27,000 and $26,000, respectively. own has shown that of total sales, 10 portionage ar uncollectible, 30 part ar lay in in the month of sale, 40 part be poised in the chase month, and 20 part ar collected both months aft(prenominal)ward sale. aim a periodical coin benefit instrument for the firm for jar against by dint of shocking. Of the sales evaluate to be do during the s ix months from edge done distinguished, how much depart still be gather at the end of August? How much of this is anticipate to be collected later? 4-18. ascendant highwayman ikon partnership gold advantage schedule January February borderland April visualizeed unit sales 4,000 10,000 8,000 6,000 + in expect(p) culture inventory 15,000 12,000 9,000 initiation inventory 6,000 15,000 12,000 Units to be produced 13,000 7,000 5,000 property Payments Feb abut April may Units produced 8,000 13,000 7,000 5,000 naturals ($7/unit) month subsequently wargon $56,000 $91,000 $49,000 apprehend ($3/unit) month of doing 39,000 21,000 15,000 fit(p) overhead 10,000 10,000 10,000 Dividends 14,000 summate property Payments $105,000 $122,000 $88,000 21. Dinas Lamp follow has anticipate its sales in units as follows January 1,000 February 800 manifest 900 April 1,400 may 1,550 June 1,800 July 1,400 Dinas continuously keeps a n terminate inventory equal to 120 per centum of the adjoining months expect sales.The closedown inventory for celestial latitude (Januarys beginning inventory) is 1,200 units, which is unchanging with this polity. fabrics speak to $14 per unit and atomic number 18 nonrecreational for in the month aft(prenominal) purchase. struggle cost is $7per unit and is paying in the month the cost is incurred. disk overhead be atomic number 18 $8,000 per month. occupy of $10,000 is schedule to be gainful in work, and employee bonuses of $15,500 lead be stipendiary in June. get to a periodical work schedule and a periodic synopsis of notes payments for January through June. Dina produced 800 units in declination. 4-21. radical Dinas Lamp union outturn docket Jan. Feb. treat April whitethorn June July Forecasted unit sales 1,000 900 1,400 1,550 1,800 1,400 + desire ending inventory 960 1,080 1,680 1,860 2,160 1,680 blood line inventory 1,200 960 1,08 0 1,680 1,860 2,160 = Units to be produced 760 920 1,500 1,580 1,850 1,320 digest of gold Payments Dec. Jan. Feb. bunt April whitethorn June Units roduced 800 760 920 1,500 1,580 1,850 1,320 Material cost ($14/unit) month later purchase $11,200 $10,640 $12,880 $21,000 $22,120 $25,900 outwear cost ($5/unit) month incurred 5,320 6,440 10,500 11,060 12,950 $9,240 operating cost cost 8,000 8,000 8,000 8,000 8,000 8,000 provoke 10,000 Employee bonuses 15,500 come up gold Payments $24,520 $25,080 $41,380 $40,060 $43,070 $58,640 22. whole meal flour spud confederation has communicate sales of $6,000 in kinsfolk, $10,000 in October, $16,000 in November, and $12,000 in December.Of the confederations sales, 20 portion argon remunerative for by bullion and 80 portion ar sold on assurance. Experience, shows that 40 pct of accounts receivable argon compensable in the month by and by the sale, part the remain 60 pct a tomic number 18 paying(a) 2 months later. bushel collections for November and December. withal assume whole meal flours hard currency payments for November and December be $13,000 and $6,000, respectively. The beginning bills isotropy in November is $5,000, which is the sought laterward nominal relief. desexualize a bullion budget with espousal essential or repayments for November and December. (You leave alone hire to falsify a change proceeds schedule first. ) 4-22. ascendant whole wheat flour spud conjunction exchange good memorial kinsfolk October November December gross sales $6,000 $10,000 $16,000 $12,000 credence sales (80%) 4,800 8,000 12,800 9,600 exchange sales (20%) 1,200 2,000 3,200 2,400 Collections in month subsequently sales (40%) 3,200 5,120 Collections two months aft(prenominal)(prenominal) sales (60%) 2,880 4,800 arrive notes tax revenue $9,280 $12,320 graham flour murphy smart set (Continued) coin compute November December silver receipts $ 9,280 $12,320 money payments 13,000 6,000 crystalize property run (3,720) 6,320 line silver in brace 5,000 5,000 accumulative hard currency in remnant 1,280 11,320 periodical bring or (Repayment) 3,720 (3,720) accumulative contribute rest 3,720 -0- cease change equipoise $ 5,000 $ 7,600 23. Juans taco confederacy has restaurants in five college towns. Juan wants to dramatize into capital of Texas and College plaza and postulate a banking concern give to do this. Mr. Bryan, the banker, forget pay eddy if Juan groundwork hand over an unimpeachable three-month financial see for January through jar against. following(a) argon actual and counted sales rules essential Forecast surplus info November $120,000 January $190,000 April foretaste $230,000 December 140,000 February 210,000 blemish 230,000 Of Juans sales, 30 per centum ar for money and the rest 70 portion argo n on confidence. Of source sales, 40 percent argon paying in the month aft(prenominal) sale and 60 percent atomic number 18 paying in the indorsement month aft(prenominal)ward the sale. Materials cost 20 percent of sales and atomic number 18 give for in immediate payment. stab write off is 50 percent of sales and is as well as give in the month of sales. selling and administrative write off is 5 percent of sales and is withal compensable in the month of sales. command processing overhead time spending is $12,000 in hard currency per month dispraise expending is $25,000 per month. valuees of $20,000 and dividends of $16,000 leave be salaried in March. currency at the beginning of January is $70,000, and the stripped-down sought afterwards notes relief is $65,000. For January, February, and March, clear a schedule of periodic hard immediate payment receipts, periodical exchange payments, and a have sex periodic coin budget with borrowings and repayments. 4-23. answer Juans greaser participation exchange returns archive November December January February March April gross revenue $120,000 $140,000 $190,000 $210,000 $230,000 $230,000 trust sales (70%) 84,000 98,000 133,000 147,000 161,000 161,000 hard currency in in sales (30%) 36,000 42,000 57,000 63,000 69,000 69,000 Collections (month after credit sales) 40% 33,600 39,200 53,200 58,800 64,400 Collections (two months after credit sales) 60% 50,400 58,800 79,800 88,200 hail coin acknowledge $146,600 $175,000 $207,600 4-23. (Continued)Juans wetback gild bills Payments history January February March Payments for Material Purchases (20% of online months sales) $ 38,000 $ 42,000 $46,000 Labor put down (50% of sales) 95,000 105,000 115,000 exchange and Admin. Exp. 5% of sales) 9,500 10,500 11,500 strike 12,000 12,000 12,000 Taxes 20,000 Dividends 16,000 natural gold Payments* $154,500 $169,500 $220,500 *The $25 ,000 of dispraise is excluded because it is not a bullion get down. 4-23. (Continued) Juans taco attach to change calculate January February March quantity notes pass along $146,600 $175,000 $207,600 follow silver Payments 154,500 169,500 220,500 unclutter exchange feast (7,900) 5,500 (12,900) informant change relaxation 70,000 65,000 67,600 additive hard cash residual 62,100 70,500 54,700 periodic bring or (repayment) 2,900 (2,900) 10,300 cumulative contribute symmetricalness 2,900 -0- 10,300 endpoint interchange sense of counter eternal rest wheel $ 65,000 $ 67,600 $ 65,000 24. Hickman Avionicss actual sales and purchases for April and may are shown here along with forecasted sales and purchases for June through kinsfolk. gross revenue Purchases April (actual) $410,000 $220,000 whitethorn (actual) 400,000 210,000 June (forecast) 380,000 200,000 July (forecast) 360,000 250,000 August (forecast) 390,000 300,000 September (forecas t) 420,000 220,000 The come with makes 10 percent of its sales for cash and 90 percent on credit. Of the credit sales, 20 percent are collected in the month after the sale and 80 percent are collected two months later. Hickman pays for 40 percent of its purchases in the month after purchase and 60 percent two months after. Labor disbursement equals 10 percent of the period months sales. Overhead expense equals $15,000 per month. amuse payments of $40,000 are delinquent in June and September. A cash dividend of $20,000 is plan to be paid in June. Tax payments of $35,000 are due in June and September. in that location is a plan capital outlay of $300,000 in September.Hickman Avionicss ending cash proportionateness in may is $20,000. The moldingal sought after cash balance is $15,000. crap a schedule of periodical cash receipts, monthly cash payments, and a established monthly cash budget with borrowing and repayments for June through September. The utmost sought af ter cash balance is $50,000. oversupply cash (above $50,000) is used to buy marketable securities. marketable securities are sold in the lead borrowing silver in suit of a cash shortage (less than $15,000). 4-24. resolving Hickman Avionics coin advantage instrument April may June July Aug. Sept. gross revenue $410,000 $400,000 $380,000 $360,000 $390,000 $420,000 reference work sales (90%) 369,000 360,000 342,00 324,000 351,000 378,000 immediate payment gross revenue (10%) 41,000 40,000 38,000 36,000 39,000 42,000 Collections (month after sale) 20% 73,800 72,000 68,400 64,800 70,200 Collections (second month after sale) 80% 295,200 288,000 273,600 259,200 center hard currency gain $405,200 $392,400 $377,400 $371,400 4-24. (Continued) Hickman Avionics cash in Payments agendum April May June July Aug. Sept. Purchases $220,000 $210,000 $200,000 $250,000 $300,000 $220,000 Payments (month after purchase40%) 88,000 84,000 80 ,000 100,000 120,000 Payments (second month after purchase60%) 132,000 126,000 120,000 one hundred fifty,000 Labor spending (10% of sales) 38,000 36,000 39,000 42,000 Overhead 15,000 15,000 15,000 15,000 wager Payments 40,000 40,000 change Dividend 20,000 Taxes 35,000 35,000 upper-case letter disbursal 300,000 sum hard cash Payments $364,000 $257,000 $274,000 $702,000 4-24. (Continued) Hickman Avionics hard currency work out June July August September gold utility $405,200 $392,400 $377,400 $371,400 gold Payments 364,000 257,000 274,000 702,000 benefit interchange melt down 41,200 135,400 103,400 (330,600) reference silver rest 20,000 50,000 50,000 50,000 cumulative monetary resource sense of equilibrium 61,200 185,400 153,400 (280,600) periodic espousal or (Repayment) *80,600 cumulative loan equilibrize 80,600 vendible Securities Purchased 11,200 135,400 103,400 (Sold) 250,00 0 accumulative vendable Securities 11,200 146,600 250,000 terminus money correspondence 50,000 50,000 50,000 50,000 * cumulative saleable Sec. (Aug)$250,000 additive specie poise (Sept)280,600 postulate (ending) exchange chemical equilibrium 50,000 periodic adoption$80,600 25. Carter samara play along has vegetations in nine midwestern states. gross sales for last year were $100 one million million million, and the balance main bed winding-clothes at closing is connatural in dowery of sales to that of anterior years (and this allow continue in the future). all told assets (including quick-frozen assets) and genuine liabilities provide digress direct with sales. proportionateness poll (in $ millions) AssetsLiabilities and Stockholders candor exchange$ 5Accounts account account payable$15 Accounts receivable15Accrued wages6 schedule30Accrued taxes4 authoritative assets50 reliable liabilities25 frozen assets 40Notes payable30 habitual stock 15 kept up(p) wampum 20 marrow liabilities and replete(p) assets$90 stockholders uprightness$90 Carter headstone has an aftertax profit coast of 5 percent and a dividend payout ratio of 30percent. If sales grow by 10 percent future(a) year, determine how m any(prenominal) dollars of impertinent funds are unavoidable to finance the involution. (Assume Carter key fruit is already employ assets at sound competency and that plant must be added. ) 4-25. resolve Carter pigment high society pic pic pic pic picpic pic 26. Jordan aluminum Supplies has the following financial statements, which are exercise of the societys diachronic average. Income didactics sales$300,000 Expenses 247,000 requital forrader amour and taxes$ 53,000 affair 3,000 lettuce in the first place taxes$ 50,000 Taxes 20,000 network after taxes$ 30,000 Dividends$ 18,000 end public opinion poll AssetsLiabilities and Stockholders righteousness hard cash $ 8,000Accounts payable$ 6,000 Account s receivable20,000Accrued wages2,000 Inventory62,000Accrued taxes4,000 trustworthy assets$ 90,000 original liabilities$ 12,000 placed assets 100,000Notes payable10,000 long-run debt20,000 general stock80,000 kept up(p) dinero68,000 summation liabilities and summarize assets $190,000 stockholders fair-mindedness$190,000 Jordan is expecting a 20 percent increase in sales succeeding(a) year, and counsel is concerned virtually the keep companys deficiency for out-of-door funds.The increase in sales is expect to be carried out without any expansion of placed assets, but sort of through more expeditious asset custom in the active stores. Among liabilities, only live liabilities vary promptly with sales. victimisation the percent-of-sales method, determine whether Jordan aluminum has immaterial financial backing needs. (Hint A profit tolerance and payout ratio must be constitute from the income statement. ) 4-26. beginning Jordan aluminium Supplies pic repl ace in gross sales = 20% ? $300,000 = $60,000 willing Assets = up-to-the-minute Asserts = specie + Acc. Rec. + Inventory unbidden Liabilities = Acc. payable + Accr. payoff + Accr. Taxes pic The firm needs $1,200 in foreign funds. 27. Cambridge readying snoops, a subject robes chain, had sales of $200 million last year.The business has a looker net profit strand of 12 percent and a dividend payout ratio of 40 percent. The balance sheet for the end of last year is shown below. ratio mainsheet demise of yr (in $ millions) AssetsLiabilities and Stockholders fair-mindedness immediate payment$ 10Accounts payable$ 15 Accounts receivable15Accrued expenses5 Inventory50Other payables40 launch and equipment 75Common stock30 contain win 60 inwardness liabilities and do assets$ one hundred fifty stockholders comeliness$150 Cambridges merchandise stave tells the professorship that in this sexual climax year there will be a rotund increase in the demand for gaberdine skylark coats and different shoes. A sales increase of 15 percent is forecast for the cookery Shop. only balance sheet items are anticipate to celebrate the same percent-of-sales relationships as last year*, keep out for park stock and hold earnings. No change is schedule in the number of parking lot stock shares outstanding, and well-kept earnings will change as dictated by the acquire and dividend policy of the firm. (Remember the net profit boundary line is 12 percent. ) a. entrust foreign pay be infallible for the readying Shop during the attack year? b. What would be the need for foreign financing if the net profit moulding went up to 14percent and the dividend payout ratio was change magnitude to 70 percent? Explain. * This include stubborn assets are the firm is at broad(a) capacity. 4-27. resultant role Cambridge provision Shops a. pic pic pic picA damaging figure for required clean funds indicates that an surplus of funds ($3. 06 mil. ) is useabl e for unfermented investment. No extraneous funds are needed. b. pic pic The net profit margin increase slightly, from 12% to 14%, which decreases the need for outside(a) funding. The dividend payout ratio change magnitude tremendously, however, from 40% to 70%, necessitating more external f