90.2K

Verified Solution

Link Copied!

We obtain the following 2020 forecasts of selected financial statement line items for Journey Company.

$ millions	2019 Actua	2020 Est.
Net Sales	623,528	651,586
Marketable securities	59,044	54,644
Long-term debt	304,971	271,425
Treasury stock (deducted from equity)	45,033	45,033
Cash generated by operations		50,772
Cash used for investing		(13,119)
Cash used for financing		(48,101)
Total net change in cash		(10,448)
Cash at beginning of period		45,004
Cash at end of period		34,556

I will rate, thank you

We obtain the following 2020 forecasts of selected financial statement line items for journey Company. Note: Complete the entire question in Excel using the following template: Excel Template. Format each answer to two decimal places. Then enter the answers into the provided spaces below with two decimal places. a. Does forecasted cash deviate from the normal level for this company? Calculate the company's normal cash level as a percentage of sales. Using the answer above, compute what should be the normal cash balance for FY2020. b. Is the deviation in part a large enough to require adjustment? Explain. c. Identify three ways to adjust the forecasted cash balance. Which option would least likely be used to adjust the cash balance? d. Complete the following statement of cash flows assuming long-term debt is used to adjust the forecasted cash balance. e. Complete the following statement of cash flows assuming marketable securities are used to adjust the forecasted cash balance

Answer & Explanation Solved by verified expert

See Answer