I want to this question answer general Accounting question The management team at PSSS is looking towardthe future. They want to maintain a gross profitmargin of 50%. If the estimate for net sales in2016 is $5 million, how much gross profit will benecessary for 2016 to maintain this ratio?

Step 1: Define Gross Profit MarginThe gross profit is the company's trading profit that represents…

Answered: The management team at PSSS is looking…

Entrepreneurial Finance

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ISBN:9781337635653

Author:Leach

Publisher:Leach

Chapter13: Other Financing Alternatives

Section: Chapter Questions

Problem 1aM

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Lanigan Logistics needs to evaluate its financial needs for 2024. It is believed that the relationship between sales and balance sheet items will remain constant when compared to 2023 figures. In 2023 LL expects sales of £4 million with net income of £0.5 million and a 50% dividend payout ratio. Sales for 2024 are forecast at £5 million with net income constant at £0.5 million. Based on the projected balance sheet below, estimate the company's external funding requirements for 2024. Lorenzo Logistics Balance Sheet 2023 Assets Current Assets £410,000 Net Fixed Assets 1,150,000 Total £1,560,000 Liabilities and Equity Accounts Payable £450.000 Long Term Debt 350,000 Total Liabilities £800.000 Common Stock £100,000 Additional Paid in Capital 210,000 Retained Earnings 450,000 Total Equity £760,000 Total £1,560,000
Net Income for Company A is $200,000 in 2014, $300,000 in 2015, $400,000 in 2016, $500,000 in 2017, and $600,000 in 2018. The expected growth for all years after 2018 is 5%, the 90-Day T-Bill Rate is 20%, and the appropriate percentage above risk-free rate is 12%. Using this information, what is the reasonable value for Company A based on its future income stream for 2014 to 2018? A. 1,394,267.03 B. 4,394,267.03 A or B?
The Blazer Company's EPS last year, EPSo, was $1.50. Blazer expects sales to increase by 15% during the coming year. If Blazer has a degree of operating leverage equal to 1.25 and a degree of financial leverage equal to 3.50, then what is its expected EPS or EPS₁? Hint: First, find DTL where DTL= DOL x DFL. Note: This is a web appendix 14A topic. O $2.48 O $2.87 O $2.02 O $1.66
Suppose a firm has had the following historic sales figures. Year: Sales 2016 $1,900,000 2017 $2,150,000 2018 $1,800,000 2019 $2,400,000 2020 $2,000,000 What would be the forecast for next year's sales using the average approach? Next year's sales
The TTF Corporation is trying to analyze how much financing it will need next year. With the recent economic recovery, more people are starting to purchase their products and thus TTF believes Sales will grow by 25% in 2024. They also believe that all assets and spontaneous liabilities will grow at the same rate as sales. TTF estimates its Net Profit Margin in 2024 will be 6% and it will pay out 40% of Net Income as a dividend. Use the below information to answer the following questions: Item 2023 Accounts Payable 200 Accounts Receivable 500 Accruals 500 Advertising Expense 750 Cash 1,500 Common Stock 1,500 Cost of Goods Sold 3,500 Depreciation Expense 300 Interest Expense 250 Inventory 800 Long Term Debt 1,000 Net Fixed Assets 3,200 Notes Payable 800 Retained Earnings 2,000 Sales 5,000 Taxes 50 The common size entry for Taxes in 2023 is 1 Outside Funds Needed in 2024 is $ 1100 %. (Input number only) (Input number only)
Suppose a firm has had the historical sales figures shown as follows. What would be the forecast for next year's sales using the average approach? Year 2017 2018 Sales $ 750,000 500,000 Multiple Choice O $695,000 $700,000 $750,000 $775.000 2019 $ 700,000 2020 $ 750,000 2021 $ 775,000
Chua Chang & Wu Inc. is planning its operations for next year, and the CEO wants you to forecast the firm's additional funds needed (AFN). Data for use in your forecast are shown below. Based on the AFN equation, what is the AFN for the coming year? $200,000 40% $127,500 20.0% Last year's sales = So Sales growth rate=g Last year's total assets = Ao Last year's profit margin = PM -$11,000 O O O O O a. b.-$25,571 c.-$7,000 d.-$25,000 e. -$19,000 Last year's accounts payable Last year's notes payable Last year's accruals Target payout ratio $50,000 $15,000 $20,000 25.0%
Suppose a firm has had the following historic sales figures. Year: 2016 2017 2018 2019 Sales $1,480,000 $1,680,000 $1,580,000 $2,070,000 2020 $1,900,000 What would be the forecast for next year's sales using FORECAST.ETS to estimate a trend? Note: Round your answer to the nearest whole dollar. Next year's sales
6. What is the difference between the Industry potential and a Company's sales forecast? In the following example, the Industry potential is deemed to be 5 million potential customers. The Industry penetration for 2021 is trending toward 30% (and forecast to increase to 40% in 2022 and to 50% in 2023). Your company's market share in 2021 is trending toward 25% (and forecast to increase to 35% in 2022 and to 45% in 2023). How many customers is your company forecasting to serve for each year 2021 through 2023? Show your calculations.
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Your company forecasts that next year's sales will be $59.00 million, Cost of Goods Sold (COGS) will be 85% of sales, and the Days Payables Outstanding (DPO) ratio will be 22.19. What is the forecasted accounts payable for next year?

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The management team at PSSS is looking toward the future. They want to maintain a gross profit margin of 50%. If the estimate for net sales in 2016 is $5 million, how much gross profit will be necessary for 2016 to maintain this ratio?