Excel Activity: Forecasting Financial Statements

Start with the partial model in the file Cho9 P10 Build

a Model.xlsx, which contains the 2021 financial

statements of Zleber Corporation. Forecast Zieber's

2022 income statement and balance sheets. Use

the following assumptions: (1) Sales grow by 7%. (2)

The ratios of expenses to sales, depreciation to fixed

assets, cash to sales, accounts receivable to sales,

inventories to sales, fixed assets to sales,

accounts payable to sales, and accruals to sales will

be the same in 2022 as in 2021. (3) Zieber will not

issue any new stock or new long-term bonds. (4) The

interest rate is 11% for long-term debt, and the

Interest expense on long-term debt is based on the

average balance during the year. (5) No interest is

earned on cash. (6) Regular dividends grow at an 8%

rate. (7) The tax rate is 25%.

Calculate the additional funds needed (AFN). If new

financing is required, assume it will be raised by

drawing on a line of credit with an interest rate of

12%. Assume that any draw on the line of credit will

be made on the last day of the year, so there will be

no additional interest expense for the new line of

credit. If surplus funds are available, pay a special

dividend.

The data has been collected in the Microsoft Excel

file below. Download the spreadsheet and perform

the required analysis to answer the questions below.

Do not round intermediate calculations. Enter your

answers in thousands. For example, an answer of

$1.23 thousand should be entered as 1.23, not

1,230. Round your answers to two decimal places. If

your answer is zero, enter "O".

How do you calculate the 2022 input ratios, 2022 Preliminary forecast and the 2022 Final forcast? This is my question