Filling in Blanks and Financial Forecasting. The following data pertain to ABC Company:
Balance Sheet Items on December 31, 20X1 (in Thousands of Dollars)
20X1 Percentage of Sales (20X1 Sales= $400) Pro Forma Balance Sheet on December 31, 20X2 (Projected Sales = $600)
Cash $ 10 2.5 $ 15
Receivables 90 22.5 135
Inventories 200 50.0 300
Total current assets $300 75.0 $450
Net fixed assets 300 75.0 450
Total assets $600 150.0 $900
Accounts payable $ 40 10.0 $ 60
Notes payable 20 n.a. (c)
Accrued wages and taxes 40 10.0 60
Total current liabilities $100 (b)
Mortgage bonds $140 n.a. (d )
Common stock 60 n.a. (f )
Retained earnings 300 n.a. 324
Total $600 (e) Funds provided
(a) Additional funds needed
In addition, ABC Company must maintain a total debt/total assets ratio at or below 40 percent and a current ratio at or above 2.5. Within these constraints, ABC would prefer to finance using short-term rather than long-term debt or long-term debt rather than equity. Fill in the missing terms on the December 31, 20X2, pro forma balance sheet.