Need help with #7 Short term Financial Planning, will vote if I got it right. Thank you.

B. If Itsar Products has a cash need, indicate the month when the need will begin and determine the 218 Purt Planning for the Future MONTH Januar February April May June CASN RECEIPTS CASN DISBURSEMENTS 120000 $100 000 50.000 $110.000 March $110.000 $100.000 $150 000 $120.000 $180 000 $160.000 $180,000 200.000 $180.000 250000 $180.000 250.000 $150.000 200 000 $110.000 $140.000 $100,000 A Determine whether Itsar Products will have a cash need during the next year. $100.000 $100,000 August September October November December month and amount when the maximum need will occur. Determine whether the cash need (if any) can be repaid within the next year. 2. Short-Term Financial Planning) Rework Problem I assuming minimum cash-on-hand requirements are $10.000 a month through May, increase to $15,000 in June and July, increase further to $20,000 in August and September, and return to the $10,000 per month level beginning in October 3. [Short-Term Financial Planning) The PDC Company was described earlier in this chapter. Refer to the PDC Company's projected monthly operating schedules in Table 6.2. PDC's sales are projected to be $80,000 in September 2017 A. Prepare PDC's sales schedule, purchases schedule, and wages schedule for August 2017. B. Prepare a cash budget for August 2017 for PDC and describe how the forecast affects the end of month cash balance. 4. (Short-Term Financial Planning The PDC Company was described earlier in this chapter. Refer to the PDC Company's projected monthly operating schedules in Table 6.2. PDC's sales are projected to be $80,000 in September 2017 A. Prepare PDC's projected income statement for August B. Prepare PDC's projected balance sheet for August. C. Prepare PDC's projected statement of cash flow for August. D. Compare your balance sheet at the end of August with the balance sheet in Table 6.1 and apply the balance sheet method to determine cash flows over the March-August period. 5. (Short-Term Financial Planning) Rework Problem 3 based on the assumption that, because of an unex- pected order, PDC's sales are forecasted to be $160,000 for September 2017. 6. [Short-Term Financial Planning) Rework Problem 4 based on the assumption that, because of an unex- pected order, PDC's sales are forecasted to be $160,000 for September 2017. 7. Short-Term Financial Planning) Artero Corporation is a traditional toy products retailer that recently started an Internet-based subsidiary that sells toys online. A markup is added on goods the company purchases from manufacturers for resale. Swen Artero, the company president, is preparing for a meet ing with Jennifer Brown, a loan officer with First Banco Corporation, to review year-end financing te quirements. After discussions with the company's marketing manager, Rolf Eriksson, and finance manager, Lisa Erdinger, sales over the last three months of 2017 are forecasted to be: MONTH October 2017 November December SALES FORECAST (IN S THOUSANDS) $1.000 1,500 3,000 Artero's balance sheet as of the end of September 2017 was as follows: Cash Accounts receivable Inventories ARTERO CORPORATION BALANCE SHEET AS OF SEPTEMBER 30, 2017 (IN S THOUSANDS) $ 50 Accounts payable 700 Notas payable 500 Long term debt Net fixed assets 750 Total liabilities Equity Total assets $2.000 Total liabilities and equity $ 0 800 400 1.200 000 52000 All sales are made on credit terms of net 30 days and are collected the following month. No bad debts are anticipated. The accounts receivable on the balance sheet at the end of September thus will be collected in October, the October sales will be collected in November, and so on. Inventory on hand represents a minimum operating level (or safety stock), which the company intends to main- tain. Cost of goods sold averages 80 percent of sales. Inventory is purchased in the month of sale and paid for in cash. Other cash expenses average 7 percent of sales. Depreciation is $10,000 per month. Assume taxes are paid monthly and the effective income tax rate is 40 percent for planning purposes. The annual interest rate on outstanding long-term debt and bank loans (notes payable) is 12 percent. There are no capital expenditures planned during the period, and no dividends will be paid. The com- pany's desired end-of-month cash balance is $80,000. The president hopes to meet any cash shortages during the period by increasing the firm's notes payable to the bank. The interest rate on new loans will be 12 percent. A. Prepare monthly pro forma income statements for October, November, and December and for the quarter ending December 31, 2017 B. Prepare monthly pro forma balance sheets at the end of October, November, and December 2017 C Prepare both a monthly cash budget and pro forma statements of cash flows for October, Novem- ber, and December 2017. D. Describe your findings and indicate the maximum amount of bank borrowing that is needed. (Cash Conversion Cycle) Two years of financial statement data for the Munich Export Corporation are shown below. A. Calculate the inventory-to-sale, sale-to-cash, and purchase-to-payment conversion periods for Munich Exports for 2016. B. Calculate the length of Munich Exports' cash conversion cycle for 2016. MUNICH EXPORTS CORPORATION 2015 BALANCE SHEET Cash Accounts receivable Inventories Total current assets Fixed assets, net Total assets $ 50.000 200.000 450.000 700.000 300.000 $1.000.000 2016 $ 50.000 300.000 570.000 320.000 380.000 $1.300.000 B. If Itsar Products has a cash need, indicate the month when the need will begin and determine the 218 Purt Planning for the Future MONTH Januar February April May June CASN RECEIPTS CASN DISBURSEMENTS 120000 $100 000 50.000 $110.000 March $110.000 $100.000 $150 000 $120.000 $180 000 $160.000 $180,000 200.000 $180.000 250000 $180.000 250.000 $150.000 200 000 $110.000 $140.000 $100,000 A Determine whether Itsar Products will have a cash need during the next year. $100.000 $100,000 August September October November December month and amount when the maximum need will occur. Determine whether the cash need (if any) can be repaid within the next year. 2. Short-Term Financial Planning) Rework Problem I assuming minimum cash-on-hand requirements are $10.000 a month through May, increase to $15,000 in June and July, increase further to $20,000 in August and September, and return to the $10,000 per month level beginning in October 3. [Short-Term Financial Planning) The PDC Company was described earlier in this chapter. Refer to the PDC Company's projected monthly operating schedules in Table 6.2. PDC's sales are projected to be $80,000 in September 2017 A. Prepare PDC's sales schedule, purchases schedule, and wages schedule for August 2017. B. Prepare a cash budget for August 2017 for PDC and describe how the forecast affects the end of month cash balance. 4. (Short-Term Financial Planning The PDC Company was described earlier in this chapter. Refer to the PDC Company's projected monthly operating schedules in Table 6.2. PDC's sales are projected to be $80,000 in September 2017 A. Prepare PDC's projected income statement for August B. Prepare PDC's projected balance sheet for August. C. Prepare PDC's projected statement of cash flow for August. D. Compare your balance sheet at the end of August with the balance sheet in Table 6.1 and apply the balance sheet method to determine cash flows over the March-August period. 5. (Short-Term Financial Planning) Rework Problem 3 based on the assumption that, because of an unex- pected order, PDC's sales are forecasted to be $160,000 for September 2017. 6. [Short-Term Financial Planning) Rework Problem 4 based on the assumption that, because of an unex- pected order, PDC's sales are forecasted to be $160,000 for September 2017. 7. Short-Term Financial Planning) Artero Corporation is a traditional toy products retailer that recently started an Internet-based subsidiary that sells toys online. A markup is added on goods the company purchases from manufacturers for resale. Swen Artero, the company president, is preparing for a meet ing with Jennifer Brown, a loan officer with First Banco Corporation, to review year-end financing te quirements. After discussions with the company's marketing manager, Rolf Eriksson, and finance manager, Lisa Erdinger, sales over the last three months of 2017 are forecasted to be: MONTH October 2017 November December SALES FORECAST (IN S THOUSANDS) $1.000 1,500 3,000 Artero's balance sheet as of the end of September 2017 was as follows: Cash Accounts receivable Inventories ARTERO CORPORATION BALANCE SHEET AS OF SEPTEMBER 30, 2017 (IN S THOUSANDS) $ 50 Accounts payable 700 Notas payable 500 Long term debt Net fixed assets 750 Total liabilities Equity Total assets $2.000 Total liabilities and equity $ 0 800 400 1.200 000 52000 All sales are made on credit terms of net 30 days and are collected the following month. No bad debts are anticipated. The accounts receivable on the balance sheet at the end of September thus will be collected in October, the October sales will be collected in November, and so on. Inventory on hand represents a minimum operating level (or safety stock), which the company intends to main- tain. Cost of goods sold averages 80 percent of sales. Inventory is purchased in the month of sale and paid for in cash. Other cash expenses average 7 percent of sales. Depreciation is $10,000 per month. Assume taxes are paid monthly and the effective income tax rate is 40 percent for planning purposes. The annual interest rate on outstanding long-term debt and bank loans (notes payable) is 12 percent. There are no capital expenditures planned during the period, and no dividends will be paid. The com- pany's desired end-of-month cash balance is $80,000. The president hopes to meet any cash shortages during the period by increasing the firm's notes payable to the bank. The interest rate on new loans will be 12 percent. A. Prepare monthly pro forma income statements for October, November, and December and for the quarter ending December 31, 2017 B. Prepare monthly pro forma balance sheets at the end of October, November, and December 2017 C Prepare both a monthly cash budget and pro forma statements of cash flows for October, Novem- ber, and December 2017. D. Describe your findings and indicate the maximum amount of bank borrowing that is needed. (Cash Conversion Cycle) Two years of financial statement data for the Munich Export Corporation are shown below. A. Calculate the inventory-to-sale, sale-to-cash, and purchase-to-payment conversion periods for Munich Exports for 2016. B. Calculate the length of Munich Exports' cash conversion cycle for 2016. MUNICH EXPORTS CORPORATION 2015 BALANCE SHEET Cash Accounts receivable Inventories Total current assets Fixed assets, net Total assets $ 50.000 200.000 450.000 700.000 300.000 $1.000.000 2016 $ 50.000 300.000 570.000 320.000 380.000 $1.300.000