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eBook Additional Funds Needed The Booth Company's sales are forecasted to double from $1,000 in 2019 to $2,000...

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Finance

eBook

Additional Funds Needed

The Booth Company's sales are forecasted to double from $1,000in 2019 to $2,000 in 2020. Here is the December 31, 2019, balancesheet:

Cash$  100Accounts payable$   50
Accounts receivable200Notes payable150
Inventories200Accruals50
Net fixed assets500Long-term debt400
Common stock100
Retained earnings250
  Total assets$1,000  Total liabilities and equity$1,000

Booth's fixed assets were used to only 50% of capacity during2019, but its current assets were at their proper levels inrelation to sales. All assets except fixed assets must increase atthe same rate as sales, and fixed assets would also have toincrease at the same rate if the current excess capacity did notexist. Booth's after-tax profit margin is forecasted to be 6% andits payout ratio to be 45%. What is Booth's additional funds needed(AFN) for the coming year? Round your answer to the nearestdollar.

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