Here are the abbreviated financial statements for Planner's Peanuts: INCOME STATEMENT, 2019 $2,500 Sales 1,900 $ 600 Cost Net income BALANCE SHEET, YEAR-END 2019 2018 $ 853 Equity _ 1,647 2019 $1,000 2018 Assets $2,500 $3,600 Debt 2,600 Total $2,500 $3,600 Total $2,500 $3,600 a. If sales increase by 20% in 2020 and the company uses a strict percentage of sales planning model (meaning that all items on the income and balance sheet also increase by 20%), what must be the balancing item? b. What will be the value of this balancing item? Balancing item a. b. Value
Here are the abbreviated financial statements for Planner's Peanuts: INCOME STATEMENT, 2019 $2,500 Sales 1,900 $ 600 Cost Net income BALANCE SHEET, YEAR-END 2019 2018 $ 853 Equity _ 1,647 2019 $1,000 2018 Assets $2,500 $3,600 Debt 2,600 Total $2,500 $3,600 Total $2,500 $3,600 a. If sales increase by 20% in 2020 and the company uses a strict percentage of sales planning model (meaning that all items on the income and balance sheet also increase by 20%), what must be the balancing item? b. What will be the value of this balancing item? Balancing item a. b. Value
Chapter10: Valuing Early-stage Ventures
Section: Chapter Questions
Problem 1aM
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Question
![Here are the abbreviated financial statements for Planner's Peanuts:
INCOME STATEMENT,
2019
$2,500
1,900
Sales
Cost
Net income
$
600
BALANCE SHEET, YEAR-END
2018
2019
2018
2019
$1,000
2,600
Assets
$2,500
$3,600
Debt
2$
853
Equity
1,647
Total
$2,500
$3,600
Total
$2,500
$3,600
a. If sales increase by 20% in 2020 and the company uses a strict percentage of sales planning model (meaning that all items on the
income and balance sheet also increase by 20%), what must be the balancing item?
b. What will be the value of this balancing item?
Balancing item
а.
b.
Value](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F8e615c75-2a0b-4a42-8159-bcac2309173b%2Fa89a56d9-b542-40d0-b982-5b713f27dbf2%2Fz1fzwx_processed.png&w=3840&q=75)
Transcribed Image Text:Here are the abbreviated financial statements for Planner's Peanuts:
INCOME STATEMENT,
2019
$2,500
1,900
Sales
Cost
Net income
$
600
BALANCE SHEET, YEAR-END
2018
2019
2018
2019
$1,000
2,600
Assets
$2,500
$3,600
Debt
2$
853
Equity
1,647
Total
$2,500
$3,600
Total
$2,500
$3,600
a. If sales increase by 20% in 2020 and the company uses a strict percentage of sales planning model (meaning that all items on the
income and balance sheet also increase by 20%), what must be the balancing item?
b. What will be the value of this balancing item?
Balancing item
а.
b.
Value
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