Does the firm require additional external financing hint


Assume that all current assets and current liabilities change with sales and that sales are expected to grow to $8,000.

a. Use the percent of sales forecasting method to forecast these values and enter them in the forecast column of the balance sheet above.

b. The net profit margin (what the firm earns on sales) is 8%. Forecast the new level of equity and enter it in the forecast column of the balance sheet above.

c. Complete the balance sheet. Does the firm require additional external financing hint EFR calculation)? If so, how much?

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Finance Basics: Does the firm require additional external financing hint
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