EMM, Inc. has the following balance sheet: EMM, Incorporated Balance Sheet as of 12/31/X0 Assets Liabilities and Equity Cash $ 1,200 Accounts payable $ 4,900 Accounts receivable 8,900 Bank note payable 7,700 Inventory 6,100 Long-term assets 4,400 Equity 8,000 $ 20,600 $ 20,600 It has estimated the following relationships between sales and the various assets and liabilities that vary with the level of sales: Accounts receivable = $3,560 + 0.35 Sales, Inventory = $2,356 + 0.28 Sales, Accounts payable = $1,449 + 0.20 Sales. If the firm expects sales of $27,000, what are the forecasted levels of the balance sheet items above? Round your answers to the nearest dollar. Accounts receivable: $ Inventory: $ Accounts payable: $ Will the expansion in accounts payable cover the expansion in inventory and accounts receivable? Round your answers to the nearest dollar. The expansion in accounts payable of $ the total expansion in inventory and accounts receivable, which is $ . If the firm earns 12 percent on sales after taxes and retains all of these earnings, what is the forecasted equity? Round your answer to the nearest dollar. $ Construct a new balance sheet that incorporates the issuing of additional short-term debt to cover any needs for additional finance. If the firm has excess funds, add them to cash. Round your answers to the nearest dollar. EMM, Incorporated Balance Sheet as of 12/31/X1 Assets Liabilities and Equity Cash $ Accounts payable $ Accounts receivable Bank note payable Inventory Long-term assets Equity $ $

Managerial Accounting: The Cornerstone of Business Decision-Making

7th Edition

ISBN:9781337115773

Author:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger

Publisher:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger

Chapter15: Financial Statement Analysis

Section: Chapter Questions

Problem 56P: The following selected information is taken from the financial statements of Arnn Company for its...

See similar textbooks

Related questions

Question

EMM, Inc. has the following balance sheet:

EMM, Incorporated Balance Sheet as of 12/31/X0
Assets		Liabilities and Equity
Cash	$	1,200	Accounts payable	$	4,900
Accounts receivable		8,900	Bank note payable		7,700
Inventory		6,100
Long-term assets		4,400	Equity		8,000
	$	20,600		$	20,600

It has estimated the following relationships between sales and the various assets and liabilities that vary with the level of sales:

Accounts receivable	=	$3,560 + 0.35 Sales,
Inventory	=	$2,356 + 0.28 Sales,
Accounts payable	=	$1,449 + 0.20 Sales.

If the firm expects sales of $27,000, what are the forecasted levels of the balance sheet items above? Round your answers to the nearest dollar.

Accounts receivable: $

Inventory: $

Accounts payable: $
Will the expansion in accounts payable cover the expansion in inventory and accounts receivable? Round your answers to the nearest dollar.

The expansion in accounts payable of $ the total expansion in inventory and accounts receivable, which is $ .
If the firm earns 12 percent on sales after taxes and retains all of these earnings, what is the forecasted equity? Round your answer to the nearest dollar.

$

Construct a new balance sheet that incorporates the issuing of additional short-term debt to cover any needs for additional finance. If the firm has excess funds, add them to cash. Round your answers to the nearest dollar.

EMM, Incorporated Balance Sheet as of 12/31/X1
Assets		Liabilities and Equity
Cash	$		Accounts payable	$
Accounts receivable			Bank note payable
Inventory
Long-term assets			Equity
	$			$