Question: keep getting the answer wrong. I do not understand what I am doing wrong. Mr. Miyagi is very excited because sales for his nursery and
Mr. Miyagi is very excited because sales for his nursery and plant company are expected to double from $570,000 to $1140,000 next year. Mr. Miyagi notes that net assets (Assets - Liabilities) will remain at 50 percent of sales. His firm will enjoy an 9 percent return on fotal sales. He will start the year with $170,000 in the bank and is bragging about the Jaguar and luxury towntiouse he will buy. a. Compute his likely cash balance or deficit for the end of the yeat. Start with beginning cash and subtract the asset buildup (equal to 150 percent of the sales increase) and add in profit. Note: Negative amount should be indicated by a minus sign. b. Does his optimistic outlook for his cash position appear to be correct? Ye5 No
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