• wookbook
    balance sheet. Notice that the two sides do not balance. Usually, in a growing business, the asset side (uses of funds) will show a higher amount than the liability plus equity side (sources of funds), which means that external financing (EFN) is 41 needed. Row 91 subtracts row 62 from row 89...
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  • Chapter 9 solutions
    needed. 9-5 a. AFN = (A*/S)(S) – (L*/S)(S) – MS1(1 – d) = ($70) - ($70) - ($420)(0.6) = $13.44 million. b. Upton Computers Pro Forma Balance Sheet December 31, 2007 (Millions of Dollars)  Forecast...
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  • Chapter 8 Mlr
    . a. EPS/EBIT b. Financial budgeting c. TOWS analysis d. Pro forma financial statement analysis e. External analysis Ans: d Page: 285 93. The first step in preparing pro forma statements is to a. prepare the balance sheet. b. take an...
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  • Speech
    - 2 types of pro-forma financial statement : i) Pro-forma Balance Sheet ii) Pro-forma Income Statement - To construct the pro-forma financial statement, firm has to estimate the level of assets, liabilities or expenses for a future period based on...
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  • Debt vs Equity Financing
    possible dilution, or discounting, of the stock price must be considered (probably in the range of 5-10%). • The team will create pro forma operating cash flows for the project that will forecast financial models for debt and equity for 3-5 years, or more, if needed. Balance Sheets for the...
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  • Finance of Operation Management
    required. A positive external funds required figure means the firm must raise funds externally to meet its operating needs. Once it determines whether to use debt or equity, its pro forma balance sheet can be adjusted to reflect the planned financing strategy. If the figure is negative, the firm’s...
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  • East Coast Yachts
    fifty-six cents in external funds. Below are the pro forma income statements and balance sheets prepared from the sustainable growth rate. Table 1 East Coast Yachts Pro forma Income Statement Table 2 East Coast Yachts Pro forma Balance...
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  • Hemingway Fence Inc.
    , which is equipment. Using an equipment lease is a creative way to finance this project. Below is the Pro Forma Balance Sheet for this given choice. [pic] Despite distributing dividends and increasing fixed assets, the needed external financing would amount to a negative value of...
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  • Transparency in Accounting
    numbers like leases and derivatives create major transparency problems. Companies prefer to keep the maximum amount of debt off the balance sheet for various reasons such as improving financial ratios or managing earnings. Moving debt from the balance sheet to the footnotes allows businesses to mask...
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  • Financial Management
    |$1050 | |Total Liabilities + Equity |$1050 | Note that the two sides of the balance sheet must equal. This equality allows us to use the pro forma balance sheet to determine the amount of additional funds that will be needed to...
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  • Business Analysis
    Expenses and Taxes Payable Accrued expenses and taxes payable represent obligations of the firm as of the date of balance sheet preparation. Accrued expenses represent such items as salaries payable, interest payable on bank notes, insurance premiums payable, and similar items. Of primary concern...
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  • Expert Systems
    , budgeting, or for developing pro forma financial statements, analysts can use the percent-of-sales method of forecasting to create reasonable projections for certain key data. The idea is to see how a financial statement account item relates historically to sales figures, and then to use that...
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  • Fincon Part2
    . $17.5 F i n a nci a l $122.5 re q u i re m e n = $350 ($70) - $350 ($70) ts = - (0.03)(0.6)($364 + $378 + $392 + $406 + $420) = $24.5 - $3.5 - $35.28 = -$14.28 million surplus funds. 2. Tozer Computers Pro Forma Balance Sheet December 31, 2007 (Millions of Dollars) Forecast Basis × 2002 2007...
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  • Just in Time
    managers construct pro forma financial statements. • Briefly explain the steps involved in the percent of sales method. • Calculate additional funds needed (AFN), using both the projected financial statement approach and the formula method. • Identify other techniques for...
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  • Safari Way
    Forma How to Build a Pro Forma How to Prepare Pro Formas How to Prepare Pro Forma Statements of Cash Flows (play this video) About Pro Forma Financial Statements (play this video) How to Calculate EFN for a Pro Forma Balance Sheet (play this video) Understanding Financial Accounting (play...
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  • Flash Memory
    – Total liabilities & shareholders’ equity. Note that the notes payable in the above pro-forma balance sheet has already included the additional financing needed for each of the 3 years. | Figures are in $000s | | 2010 | 2011 | 2012 | Additional financing needed | $4,044 | $2,608...
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  • Toy World
    discussion • The mechanics of preparing the pro forma income statement and balance sheet • Would a bank be likely to provide the financing necessary under the smooth production plan? • Would you recommend adoption of the level production plan? • Cost savings versus risks The Current (Seasonal) Production...
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  • Case Study1
    : Prepare a pro forma balance sheet for 2011 assuming that any externals funds being acquired will be in the form of notes payable. Refer only to the info of part a. in order to answer the question. Answer: Balance sheet for year 2010 Cash 5.000.000...
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  • Financial Planning
    highlights tensions that can develop as firms pursue multiple objectives simultaneously. Pro Forma Financial Statements These are forecasts of what a firm expects its income statement and balance sheet to look like a year or two ahead. Occassionally, firms use this statements for several reasons...
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  • Jones Distribution Case Solution
    | Interest expense | $38 | Net income before taxes | $55 | Provision for income taxes | $19 | Net income | $36 | Pro Forma Balance Sheet | 2007 | Cash | $28 | Accounts receivable | $318 | Inventory | $456 | Total current assets | $802 | Property & equipment | $303...
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