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CFO of LincolnHike Inc. has created the firm’s pro forma balance sheet for the next fiscal...

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Finance

  1. CFO of LincolnHike Inc. has created the firm’spro forma balance sheet for the next fiscal year. Sales areprojected to grow by 20% to 295.5 million. Current assets, fixedassets, and short-term debt are 20 percent, 90 percent, and 15percent of sales respectively. The company pays out 40 percent ofits net income in dividends. The company currently has 32 millionof long-term debt, and 16 million in common stock par value. Theprofit margin is 12%. (20 points)

  1. Construct the current balance sheet for the firm using theprojected sales figure.

  1. Based on the sales growth forecast, how much does the companyneed in external funds for the upcoming fiscal year.

  1. Construct the firm’s pro forma balance sheet for the next fiscalyear and confirm the external funds needed that you calculated inpart (b).

Answer & Explanation Solved by verified expert
4.4 Ratings (984 Votes)
1 Current Year Balance Sheet Answer for question a Sales figure for the current financial year 2955100120 24625 million Net Income 2 246 25 2955 Asset in million    See Answer
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