Additional Funds Needed AFN ABC Inc makes bulk purchases of ladies bags and related products. The...

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Additional Funds Needed AFN ABC Inc makes bulk purchases of ladies bags and related products. The inventories are placed in a conveniently located warehouses before shipping them to its chain of retail stores. ABC Inc's balance sheet as of Dec 31, 2021 is as follows (in millions of pesos ) Cash P 3.5M receivables 26 Inventories 58 Accounts payable P 9 Notes payable 18 Accrued liabilities 8.5 Total current assets P 87.5 Total current liabilities P 35.5 Net fixed assets 35 Mortgage loan 6 Common Stock 15 Total Assets P 122.50 Retained earnings 66 Total Liabilities and Stockholders Equity P 122.50 Sales for 2021 were P 350M while net income for the year was P 10.5M. In 2021, the company paid dividends of P 4.2M to common stockholders. The firm is operating at full capacity. assume all ratios remain constant. If sales are projected to increase by P 70M, or 20% during 2022, use the AFN equation to determine the firm's external capital requirements? Additional Funds Needed AFN ABC Inc makes bulk purchases of ladies bags and related products. The inventories are placed in a conveniently located warehouses before shipping them to its chain of retail stores. ABC Inc's balance sheet as of Dec 31, 2021 is as follows (in millions of pesos ) Cash P 3.5M receivables 26 Inventories 58 Accounts payable P 9 Notes payable 18 Accrued liabilities 8.5 Total current assets P 87.5 Total current liabilities P 35.5 Net fixed assets 35 Mortgage loan 6 Common Stock 15 Total Assets P 122.50 Retained earnings 66 Total Liabilities and Stockholders Equity P 122.50 Sales for 2021 were P 350M while net income for the year was P 10.5M. In 2021, the company paid dividends of P 4.2M to common stockholders. The firm is operating at full capacity. assume all ratios remain constant. If sales are projected to increase by P 70M, or 20% during 2022, use the AFN equation to determine the firm's external capital requirements?

Answer rating: 100% (QA)

To determine the Additional Funds Needed AFN for ABC Inc for 2022 based on the projected increase in ... View the full answer