Question: QUESTION 101 In your internship with Lewis, Lee, & Taylor Inc. you have been asked to forecast the firm's additional funds needed (AFN) for next

QUESTION 101

  1. In your internship with Lewis, Lee, & Taylor Inc. you have been asked to forecast the firm's additional funds needed (AFN) for next year. The firm is operating at full capacity. Data for use in your forecast are shown below. Based on the AFN equation, what is the AFN for the coming year?

    Last year's sales = S0

    $200,000

    		 Last year's accounts payable

    $50,000
    Sales growth rate = g

    40%

    		 Last year's notes payable

    $15,000
    Last year's total assets = A0*

    $135,000

    		 Last year's accruals

    $20,000
    Last year's profit margin = PM

    20.0%

    		 Target payout ratio

    25.0%
    a.

    $14,440
    b.

    $16,800
    c.

    $16,000
    d.

    $15,200
    e.

    $17,640

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