Define each of the following terms: Operating plan; financial plan Spontaneous liabilities; profit margin; payout ratio Additional funds needed (AFN); AFN equation; capital intensity ratio; selfsupporting growth rate
Write a paper on real estate investing, pros and cons, write about the housing market, some good places to invest in real estate and some places to avoid.
August 5, 2017Explain why it is important for a fire investigator to report electrical failures and to keep up with electrical components that have been recalled due to failure or potential failure.
August 5, 2017Define each of the following terms: Operating plan; financial plan Spontaneous liabilities; profit margin; payout ratio Additional funds needed (AFN); AFN equation; capital intensity ratio; selfsupporting growth rate
W3 Assignment “Chapter 12 Questions”
QUESTIONS: 12-1, 12-4
(12-1) Define each of the following terms:
- Operating plan; financial plan
- Spontaneous liabilities; profit margin; payout ratio
- Additional funds needed (AFN); AFN equation; capital intensity ratio; selfsupporting growth rate
- Forecasted financial statement approach using percent of sales
- Excess capacity; lumpy assets; economies of scale
- Full capacity sales; target fixed assets/sales ratio; required level of fixed assets
(12-4) Name five key factors that affect a firm’s external financing requirements.
PROBLEMS: 12-4, 12-6
(12-4) Maggie’s Muffins, Inc., generated $5,000,000 in sales during 2013, and its year-end total
assets were $2,500,000. Also, at year-end 2013, current liabilities were $1,000,000,
consisting of $300,000 of notes payable, $500,000 of accounts payable, and $200,000 of
accruals. Looking ahead to 2014, the company estimates that its assets must increase at the
same rate as sales, its spontaneous liabilities will increase at the same rate as sales, its
profit margin will be 7%, and its payout ratio will be 80%. How large a sales increase can
the company achieve without having to raise funds externally—that is, what is its selfsupporting growth rate?
