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Berman & Jaccor Corporation's current sales and partial balance sheet are shown below
Berman & Jaccor Corporation's current sales and partial balance sheet are shown below.
This year
Sales $1,000
Balance Sheet: Assets
Cash $150
Short-term investments $100
Accounts receivable $100
Inventories$200
Total current assets$550
Net fixed assets$500
Total assets$1,050
Sales are expected to grow by 12% next year. Assuming no change in operations from this year to next year, what are the projected total operating assets? Do not round intermediate calculations. Round your answer to the nearest dollar.
Expert Solution
Computation of the projected total operating assets:-
Current total operating assets = Total Assets - Short-term investments
= $1,050 - $100
= $950
Note- Short term Investment are not included in Operating Assets.
Projected total operating assets = Current total operating assets*(1+ Growth Rate of sales next year)
= $950*(1+12%)
= $1,064
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