What is heart additional funds needed for the coming year

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Question - Ey-ef-en Company's sales are forecasted to increase from P1M in 2020 to P2M in 2021. Hereunder is the December 31, 2020, balance sheet:

Cash P 100,000

Accounts receivable 200,000

Inventories 200,000

Net fixed assets 500,000

Total assets P1,000,000

Accounts payable P 50,000

Notes payable 150,000

Accruals 50,000

Long-term debt 400,000

Common stock 100,000

Retained earnings 250,000

Total Liabilities & Equity P1,000,000

Ey-ef-en's fixed assets were used to only 50 percent of capacity during 2020, buts its current assets were at their proper levels. All assets except fixed assets increase at the same rate as sales, and fixed assets would also increase at the same rate if the current excess capacity did not exist. Heart's after-tax profit margin is forecasted to be 5 percent, and its payout ratio will be 60 percent. What is Heart's additional funds needed for the coming year?

Reference no: EM132935446

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