Problem
Practice Problem 16-1 Futuristic Development (FD) generated $3 million in sales last year with assets equal to $6 million. The ?rm operated at full capacity last year. Acco to FD's balance sheet, the only current liabilities are accounts payable, which equals $570,000. The only other liability is long-ten'n debt, which equ $1,035,000. The common equity section is comprised of 500,000 shares of common stock with a book value equal to $3 million and $1,395,000 of retained earnings. Next year, FD expects its sales will increase by 20 percent. The company's net pro?t margin is expected to remain at its current i which is 13 percent of sales. FD plans to pay dividends equal to $0.60 per share. It also plans to issue 50,000 shares of new common stock, which raise $360,000. Estimate the additional funds needed (AFN) to achieve the forecasted sales next year.