Question: Using the ratios as a basis for planning for next year, forecast next years Balance Sheet for the Company using the projected information below. Round

Using the ratios as a basis for planning for next year, forecast next years Balance Sheet for the Company using the projected information below. Round to the nearest dollar. Fill in all

blanks and show all work.

Next Years Sales Revenue:

This year, the Company will sell 26,250 widgets at $800 per widget. Next year, the company plans to reduce the price per widget by 10% due to improvements in manufacturing. As a result, the company expects to sell 20% more widgets next year. What will be next years revenue from sales?

Next Years Balance Sheet:

Cash: $950,000

Accruals: $55,000

Gross margin: 45%

ACP: 35 days

Inventory turnover: 5.0X

(Based on COGS)

Total Asset turnover: 1.35X

Current ratio: 2.5

Debt : Equity 1 : 4

NEXT YEARS BALANCE SHEET

ASSETS LIABILITIES & EQUITY

Cash ? Accounts payable ?

Accounts receivable ? Accruals ?

Inventory ? Current Liabilities ?

Current Assets ? Long-Term Debt ?

Net fixed assets ? Equity ?

Total Assets ? Total Liabilities & Equity ?

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