Calculation of additional funds needed.
The following is the balance sheet for 2003 for Marbell Inc.
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Marbell Inc.
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Balance Sheet
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12/31/2003
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Assets
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Liabilities and Stockholders' Equity
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Cash
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$15,000
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Accts. Payable
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$90,000
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Accts. Rec.
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90,000
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Notes payable (non-spontaneous)
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30,000
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Inventory
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60,000
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Accrued expenses
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7,500
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Current Assets
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165,000
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Current Liabilities
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127,500
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Fixed assets (non-spontaneous)
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60,000
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Common stock
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75,000
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Retained earnings
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22,500
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Total assets
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$225,000
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Total Liabilities + S. E. Equity
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$225,000
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Sales for 2002 were $300,000. Sales for 2003 have been projected to increase by 20%. Assuming that Marbell Inc. is operating below capacity, calculate the amount of new funds required to finance this growth. Marbell has an 8% return on sales and 70% is paid out as dividends.