Construct the firm proforma balance sheet

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Question - Larry Bruce, CFO of KLA Manufacturing Inc., has created the firm's pro forma balance sheet for the next fiscal year. Sales are projected to grow by 12 percent to $350 million. Current assets, fixed assets, and short-term debt are 20 percent, 75 percent, and 15 percent of sales, respectively. KLA pays out 25 percent of its net income in dividends. The company currently has $110 million of long-term debt and $45 million in common stock par value. The profit margin is 10 percent.

a. Construct the current balance sheet for the firm using the projected sales figure.

b. Based on Mr. Bruce's sales growth forecast, how much does KLA Manufacturing need in external funds for the upcoming fiscal year?

c. Construct the firm's proforma balance sheet for the next fiscal year and confirm the external funds needed that you calculated in part b.

Reference no: EM132874247

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