Janakpur Textile Company's balance sheet is given below: Balance Sheet as of December 31, 2023 Cash Rs. 200,000 Accounts payable Rs. 200,000 Account…
BBS Fundamentals of Corporate Finance · 2080 · Solved Question with Answer
Janakpur Textile Company's balance sheet is given below:
| Balance Sheet as of December 31, 2023 | |||
| Cash | Rs. 200,000 | Accounts payable | Rs. 200,000 |
| Account receivable | 350,000 | Accruals | 100,000 |
| Inventory | 450,000 | Notes payable | 300,000 |
| Total current assets | Rs. 1,000,000 | Total current liabilities | Rs. 600,000 |
| Net fixed assets | 2,000,000 | Common stock | 1,500,000 |
| Retained earnings | 900,000 | ||
| Total assets | Rs. 3,000,000 | Total liabilities and equity | Rs. 3,000,000 |
Sales are expected to increase from Rs. 10,000,000 in 2023 to Rs. 15,000,000 in 2024. Firm's after-tax profit margin is forecasted to be 10 percent and its dividend payout ratio will be 70 percent. .
a. What is the firm's additional fund needed for the year 2024 if company is running at full capacity? Use AFN equation. b. Prepare Janakpur Textile Company's pro-forma balance sheet of as of December 31, 2024