Exam 4: Financial Planning and Forecasting

The category "Cash and Cash Equivalents" includes short term investments.The time frame for short­term is:

Which of the following is a financial model that attempts to maximize or minimize the value of a criterion function (e.g., profits, costs)?

In 20X3, the Fillmore Company's sales were $12.0 million.Its balance sheet at year end 20X3 is shown below.Fillmore's 20X4 sales are expected to be $15 million and its 20X5 sales are expected to be $18 million.Earnings after tax in both years is expected to be 5.0% of sales, and annual dividends of $250,000 are expected to be paid in both 20X4 and 20X5.The company presently has excess plant and equipment capacity.As a result, assume that the net fixed asset figure on the balance sheet will remain constant for both 20X4 and 20X5.Assuming that the ratios of assets (except fixed assets, net) to sales and accounts payable to sales in 20X3 remain the same in 20X4 and 20X5, calculate the total amount, i.e., one number, of external financing required during the 2 year period from 20X4 through 20X5, using the percentage of sales method. Fillmore Co.Balance Sheet (December 31, 20X3) ($ millions)

The value of debt and equity securities is based upon:

Strategic planning for a firm deals with which of the following items?

Getrag expects its sales to increase 20% next year from its current level of $4.7 million.Getrag has current assets of $660,000, net fixed assets of $1.5 million, and current liabilities of $462,000.All assets are expected to grow proportionately with sales.If Getrag has a net profit margin of 10%, what additional financing will be needed to support the increase in sales? Getrag does not pay dividends.

Which of the following is defined as the systematic allocation of the cost of an asset over more than one period?

The Hudson River Line Company has a balance sheet as of the end of the year as follows: Cash 5,000 Accaunts Payable 15,000 Accaunts Receivable 20,000 Nates Payable 10,000 Inventaries 40,000 Tatal Curtent Liah. 25,000 Tatal Current As5ets \ 65,000 Lang-term Debt 30,000 Fixed As5ets, net 50,000 Stockholder's Equity 60,000 Tatal A5sets \ 115,000 Tatal Liabilities a Equity \ 115,000 Last year, the firm had sales of $148,750.This year the company expects sales to increase 25%, to generate earnings after tax of $16,000, and to pay a dividend of $5,000.Hudson operated its fixed assets at 85% capacity last year.What additional financing will be needed to support the sales increase?

The financial statement that shows the effects of a company's operating, investing, and financing activities on its cash balance is known as the:

Last year Curative Technologies Inc.reported earnings after-tax of $23 million.Included in the expenses were depreciation of $3.7 million and interest expenses of $2.9 million.The year-end balance sheets shows an increase in deferred taxes of $2.6 million to a total of $14.2 million.What is Curative Technologies' after­tax cash flow for last year? Assume a marginal tax rate of 40%.

The financial plan that is a "blueprint" detailing where the firm wants to be at some future point in time is the: