Pro forma balance sheet. Next year, National Beverage Company will increase its

Question

Pro forma balance sheet. Next year, National Beverage Company will increase its plant, property, and equipment by $4,000,000 with a plant expansion. The inventories will grow by 30%, accounts receivable will grow by 20%, and marketable securities will be reduced by 50% to help finance the expansion. Assume all other asset accounts will remain the same and the company will use long-term debt to finance the remaining expansion costs (no change in common stock or retained earnings). Using this information and the balance sheet in the popup window, EEB.for National Beverage Company for 2013, prepare a pro forma balance sheet for 2014. How much additional debt will the company need using this pro forma balance sheet? Complete the pro-forma balance sheet for 2014 below: (Round to the nearest dollar.) National Beverage Company Pro Forma Balance Sheet for the Year Ending December 31, 2014 ASSETS LIABILITIES Current assets Current liabilities Cash Marketable securities Accounts receivable Accounts payable Other current liabilities Total current liabilities Long-term liabilities Total current assets Long-term debt Other long-term liabilities Long-term assets Enter any number in the edit fields and then continue to the next question.

Explanation / Answer

National Beverage Company

Pro forma Balance Sheet for the year ending December 31, 2014 (Amount in $)

Estimated additional long term debt from the proforma Balance Sheet = $6,119,100-$1,314,000 = $4,805,100

Assets Amount Liabilities Amount Current Assets Current Liabilities Cash (remains same) 2,440,000 Accounts Payable (remains same) 5,622,000 Marketable Securities (1,656,000*50%) 828,000 Other Current Liabilities (remains same) 3,268,000 Accounts Receivable (2,704,000*1.20) 3,244,800 Total Current Liabilities 8,290,000 Inventories (1,641,000*1.30) 2,133,300 Long-Term Liabilities Total Current Assets 8,646,100 Long Term Debt (Bal.fig) (8,958,100-2,839,000) 6,119,100 Long-Term Assets Other Long term liabilities 2,839,000 Plant, Property and Equipment (13,686,000+4,000,000) 17,686,000 Total Long term liabilities 8,958,100 Goodwill (remains same) 1,403,000 Total Liabilities 17,248,100 Intangible Assets (remains same) 6,433,000 Owner's Equity Total Long term Assets 25,522,000 Common Stock (remains same) 6,861,000 Retained Earnings (remains same) 10,059,000 Total Owner's Equity 16,920,000 Total Assets 34,168,100 Total Liabilities and Owner's Equity 34,168,100

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