Top Posters
Since Sunday
y
2
m
2
m
2
u
2
m
2
B
2
M
2
e
2
k
2
N
2
y
2
m
2
Home Q & A Board Other Fields Homework Help Business
New Topic  
solina solina
wrote...
Go to Answer
Posts: 1273
Rep: 9 0
7 years ago
Amalgamated Enterprises is planning to purchase some new equipment. With this new equipment, the company expects sales to increase from $8,000,000 to $10,000,000. A portion of the financing for the purchase of the equipment will come from a $1,000,000 new common stock issue. The company knows that current assets, fixed assets, accounts payable, and accrued expenses increase in direct proportion with sales. The company's net profit margin on sales is 8%, and the company plans to pay 40% of its after-tax earnings in dividends. A copy of the company's current balance sheet is given below:

Amalgamated Enterprises Balance Sheet
Current assets    $3,000,000
Fixed assets    12,000,000
Total assets    $15,000,000
Accounts payable    $4,000,000
Accrued expenses    1,000,000
Long-term debt    3,000,000
Common stock    2,000,000
Retained earnings    5,000,000
Total liabilities and net worth    $15,000,000

Prepare a pro forma balance sheet for Amalgamated for next year using the percent-of-sales method and the information provided above.
Textbook 
Financial Management: Principles and Applications

Financial Management: Principles and Applications


Edition: 13th
Authors:
Read 130 times
1 Reply
Heavy Heart Thank you bio-forums! Heavy Heart
Replies
Answer verified by a subject expert
vanrheevanrhee
wrote...
#1
Top Poster
Posts: 718
Rep: 39 0
7 years ago
Sign in or Sign up in seconds to unlock everything for free
More solutions for this book are available here
This verified answer contains over 250 words.
1

Related Topics

solina Author
wrote...

7 years ago
this is exactly what I needed
smdavis
wrote...

Yesterday
You make an excellent tutor!
klyn
wrote...

2 hours ago
Brilliant ツ
New Topic      
Quick Reply
Explore
Post your homework questions and get free online help from our incredible volunteers
  563 People Browsing
Start New Topic Take the Tour CoursesNew Study Tools Topics Trending Browse by Textbook
Live Chat
Related Images
  
 291
  
 337
  
 317
Your Opinion
How often do you eat-out per week?
Votes: 81
Previous poll results: What's your favorite funny biology word?