Assignment $2-$ Forecasting Financial Statements and finding the additional funds needed $($SIFN$)$ to maloe the balance sheet balance.

Put the balance sheet into a usable form in Excel

Put the income statement into a usable form in Excel.

Acsume:

sales are going to increase $30\%$ next year.

that the short$-$term $($current assets and current liabilities$)$ will increase with sales $($ie$.$ will increase $30\%).$

fixed assets still have capacity $50$ you do no need to grow fixed assets $($or depreciation$).$

the firm has no intention of selling either common stock or bonds $($long$-$term delat$).$

dividends will increase by $$10,000$ in the year you are forecasting $($from $$60,000$ to $$70,000).$

Forecast the balance sheet using the percentage of sales method. You will need to forecast the increase in sales and the increase in NI but do not need to forecast the whole income statement for this exercise.

The balance sheet will not balance. Put the additional funds needed out to the side of the nates payable entry, as that is the likely place you'll borsow the funds.

Use the Additional Funds Needed formula to confirm your answer. If they do not match $($mine did not initially because I$\text{'}$d made a mistake, try to find out where you went wrong. Because they should match. Also, remember that the AFN formula uses the actual dollar amount of assets $($not the forecasted$)$ and the actual dollar amount of liabilities and the actual $($again$,$ not forecasted$)$ sales figure to find the AFN, howewer it uses the forecasted NI and new dividend. See the video if you do not understand. $|$

Perform sensitivity analysis. Find the above for a $10\%$ increase in sales and a $50\%$ increase in $3$ales. Use the formula to find the AFN to conform what you find when forecasting the financial statemente.

Tum in the Exceel Spreadsheet. There should be $5$ columms: $1)$ balance sheat and income statement labels, $2)$ beginning balance sheet, ${?}^3-5)$ the forecasted balance sheets. For the Income statement you need only show the Revenue $($sales$)$ forecast, and net income in each column

You must use excel formulas to forecast, do not calculate it on the calculator and type them into Excel though you may use your calculator to check yourself. You should put the $3$ AFN formulas at the bottom.