Why Choose Us?
0% AI Guarantee
Human-written only.
24/7 Support
Anytime, anywhere.
Plagiarism Free
100% Original.
Expert Tutors
Masters & PhDs.
100% Confidential
Your privacy matters.
On-Time Delivery
Never miss a deadline.
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 $ 70
Accounts receivable $ 150
Inventories $ 200
Total current assets $ 570
Net fixed assets $ 400
Total assets $ 970
Sales are expected to grow by 8% next year. Assuming no change in operations from this year to next year, what are the projected total operating assets?
Expert Solution
Computation of Projected Total Operating Assets:
Projected Total Operating Assets = Projected Cash + Projected Accounts Receivables + Projected Inventories + Projected Net Fixed Assets
Here,
Projected Cash = $1,080*0.15 = $162
Projected Accounts Receivables = $1,080*0.15 = $162
Projected Inventories = $1,080*0.20 = $216
Projected Net Fixed Assets = $1,080*0.40 = $432
Projected Total Operating Assets = $162 + $162 + $216 + $432 = $972
Workings:
Computation of Ratio of Each Operating Assets of Last Year to Last Year's Sales:
Cash = Cash/Sales = $150/$1,000 = 0.15
Accounts Receivable = $150/$1,000 = 0.15
Inventories = $200/$1,000 = 0.20
Net Fixed Assets = $400/$1,000 = 0.40
Next Year's Sales = Current Sales*(1+Growth Rate) = $1,000*1.08 = $1,080
Archived Solution
You have full access to this solution. To save a copy with all formatting and attachments, use the button below.
For ready-to-submit work, please order a fresh solution below.
