Excel Applications for Accounting Principles
4th Edition
ISBN: 9781111581565
Author: Gaylord N. Smith
Publisher: Cengage Learning
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Textbook Question
Chapter 22, Problem 5R
Suppose the company has just the opposite news and now expects unit sales for August, September, and October to be double (200%) the original estimates. What effect will this have on the company’s net income and borrowing? Explain your findings.
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Suppose a company has had the historic sales figures shown below. What would be the forecast for next years sales using the average approach?
The financial manager of Company X has just received the sales forecast for next year and it indicates that the year's sales are expected to double in the second half. What are the challenges that Company X might face in increasing its production to meet the sales projections and how can these challenges be overcome? What risks does Company X face by ramping-up production to meet the sales forecast?
Suppose a firm has had the following historic sales figures. What would be the forecast for next year's sales
using the average approach?
You must use the built-in Excel function to answer this question.
Input area:
Year
Sales
2016
2017
2018
es es e
$
1,500,000
$
1,750,000
$
1,400,000
2019
$
2,000,000
2020
$
1,600,000
Output area:
Next year's sales
Chapter 22 Solutions
Excel Applications for Accounting Principles
Ch. 22 - Ranger Industries has provided the following...Ch. 22 - Open the file MASTER from the website for this...Ch. 22 - Review the completed master budget and answer the...Ch. 22 - Suppose the company has to revise its estimates...Ch. 22 - Suppose the company has just the opposite news and...Ch. 22 - Prob. 6R
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- Your company forecasts that next year's sales will be $67.00 million and the Days Sales Outstanding (DSO) ratio will be 24.71. What is the forecasted accounts receivable for next year? Note: your answer should in millions of dollars.arrow_forwardUse the "percent of sales method" of preparing pro forma financial statements to determine the projection for next year's accounts receivable. Make the following assumptions: current year's sales are $55,750,000; current year's cost of goods sold is $25,350,000; sales are expected to rise by 25%, The firm's investment in accounts receivable in the current year is $12,600,000. The firm's marginal tax rate is 35%. What is the projection for next year's accounts receivable? $10,320,000 $11,345,000 O $15,750,000 $8,772,000arrow_forwardSuppose a firm has had the following historic sales figures. What would be the forecast for next year's sales using the average approach? Year: 2009 2010 2011 2012 2013 Sales $1,500,000 $1,750,000 $1,400,000 $2,000,000 $1,600,000arrow_forward
- Suppose that you expect a ceteris paribus decrease in average incomes of 10% this year compared to last year. How many aircrafts do you estimate that your company will sell this year? How will it impact total revenues?arrow_forwardAssuming costs vary with sales and a 20 percent increase in sales is projected, create the pro forma income statement. Create a pro forma Balance Sheet. All items will vary with sales. What is the plug variable in order for this to balance? Suppose no dividend is planned to be issued next year. What is the plug variable?arrow_forwardYour 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?arrow_forward
- Suppose a firm has had the following historic sales figures. Year: 2016 2017 2018 2019 2020 Sales $3,100,000 $3,350,000 $3,000,000 $3,600,000 $3,200,000 What would be the forecast for next year’s sales using the naïve approach?arrow_forwardIn this exercise, we develop a model for the growth rate G, in thousands of dollars per year, in sales of a product as a function of the sales level s, in thousands of dollars.† The model assumes that there is a limit to the total amount of sales that can be attained. In this situation, we use the term unattained sales for the difference between this limit and the current sales level. For example, if we expect sales to grow to 4 thousand dollars in the long run, then 4 − s gives the unattained sales. The model states that the growth rate G is proportional to the product of the sales level s and the unattained sales. Assume that the constant of proportionality is 0.8 and that the sales grow to 2 thousand dollars in the long run. (a) Find a formula for unattained sales.(b) Write an equation that shows the proportionality relation for G.G =arrow_forwardusing the projected monthly income figure calculated above, how many unitswould the company need to sell to meet the initial monthly income figure?arrow_forward
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