Question: forecast for a fictitious company using the attached spreadsheet template. the following assumptions are in the assumption part of the spreadsheet (grey highlighted cells at
forecast for a fictitious company using the attached spreadsheet template. the following assumptions are in the assumption part of the spreadsheet (grey highlighted cells at the top of the spreadsheet) and then reference those cells when projecting the appropriate income statement, balance sheet, or break-even account. Do NOT hard code numbers into your projections. 2018 - 2020 Income Statement and Balance Sheet. Assumptions: Sales growth rates in each of next 3 years: 20%, 25%, 30% Gross margin and operating expenses/sales percentage stay at 2017 level 40% tax rate No dividends Interest expense fixed at $400 / year Bank loan and LT debt stay constant 2018 A/R days = year 2017 days, then decrease by 3 days in 2019 & another 3 days in 2020 2018 Inventory days = year 2017 days then decrease by 3 days in 2019 & 2 days 2020 A/P days stays at year 2017 days Net fixed assets and accruals keep relationship with sales Required cash fixed at 1000 Calculate Additional Funds Needed as plug (to get Balance Sheet to balance!) Calculate 2017 breakeven revenues and units. Assumptions: All operating expenses are fixed Average price per unit is $50
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