Additional Funds Needed Steven Textile’s 2009 financial statemen

Additional Funds Needed Steven Textile's 2009 financial statement are shown below:


Additional Funds Needed Steven Textile's 2009 financial statemen




Additional Funds Needed Steven Textile's 2009 financial statemen


Suppose 2010 sales are projected to increase by 15% over 2009 sales. Use the forecasted financial statement method to develop a pro forma balance sheet and income statement for December 31, 2010. Use an interest rate of 10% on the balance of debt at the beginning of the year to compute interest (cash pays no interest). Use the pro forma income statement to determine the addition to retained earnings. Assume that the company was operating at full capacity in 2009, that it cannot sell off any of its fixed assets, and that any required financing will be borrowed as notes payable. Also, assume that assets, spontaneous liabilities, and operating costs are expected to increase by the same percentage as sales. Determine the additional fundsneeded.

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