Jackson Co. has the following balance sheet as of December 31, 2020. Current assets P600,000 Fixed assets 400,000 Total assets P1,000,000 Accounts payable P100,000 Accrued liabilities 100,000 Notes...

Jackson Co. has the following balance sheet as of December 31, 2020.

Current assets	P600,000
Fixed assets	400,000
Total assets	P1,000,000

Accounts payable	P100,000
Accrued liabilities	100,000
Notes payable	100,000
Long-term debt	300,000
Total common equity	400,000
Total liabilities and equity	P1,000,000

In 2020, the company reported sales of P5 million, net income of P100,000, and dividends of P60,000. The company anticipates its sales will increase 20 percent in 2021 and its dividend payout will remain at 60 percent. Assume the company is at full capacity, so its assets and spontaneous liabilities will increase proportionately with an increase in sales. Assume the company uses the AFN formula and all additional funds needed (AFN) will come from issuing new long-term debt. Given its forecast, how much long-term debt will the company have to issue in 2021?

Jun 10, 2022

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Jackson Co. has the following balance sheet as of December 31, 2020. Current assets P600,000 Fixed assets 400,000 Total assets P1,000,000 Accounts payable P100,000 Accrued liabilities 100,000 Notes...

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