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One would typically think that if I make more effort in Sales and obtain more...

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Finance

One would typically think that if I make more effort in Sales and obtain more orders, I could improve my cash holding. Lets check if this is true. Lets assume Sales will
continue to increase next year. According to the sales growth rate provided in your Excel file for 2006, put together Pro forma Financial Statements and find out whether cash position will improve. To answer this question, you will use the Excel file in your group (screenshot provided) and perform financial planning with the percent of sales approach, by calculating the estimated Income Statement and Balance Sheet items for 2006 and find out the cash
position estimated for 2006.
Percent of Sales Approach.
i. A YouTube lecture on Percent of Sales approach is provided for your
reference. Please note that our setting is slightly different where cash
doesnt vary directly with Sales, but will be used to balance the Balance
Sheet. (Hint: You can first leave it empty and continue forecasting the
Balance Sheet. Once you have all the cell-calculation set up, use Goal
Seek and set goal to Total Asset = Total Liability and Equity to solve for
Cash.)
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