Coffe Shop

Coffee Prep Shops

Balance Sheet

December 31, 2009 (in millions)

Assets Liabilities and Stockholders'Equity

Cash $20 Accounts Payable $15

Accounts Receivables 30 Accrued Expenses 5

Inventory 55 Other Payables 40

Plant and Equipment 75 Common Stock 60

Retained Earnings 60

Total Assets 180 Total Liab. + S/E 180

Other Data:

Sales last year 200 ( in millions)

Net Profit Margin 12%

Dividend Payout Ratio 40%

Forecasted Sales 15% increase from last year

Required: Find the amount needed for external financing required( all

assets are variable and all liabilities are variable)

RNF=A/S(ΔS)-L/S(ΔS)-PS2(1-D)

A/S= % RELATIONSHIP OF VARIABLE ASSETS TO SALES

ΔS= Δ change in Sales

L/S= % relationship of variable liabilities to sales

P= Profit margin

S2=The new sales level

D= Dividend Payout Ratio

RNF = 180 millions/200 millions (30 millions)-60 millions /200 millions -0.12X230 millions (1-0.40) =

= 27 millions -9 millions -0.12x230 millions x0.6 =

= 18 millions -16,56 millions

=$1,44 millions

Berry Company had the following data:

Beginning inventory 7,000 units on Jan. 1, 2009

Costs for beginning inventory per unit- Material $9.00, $5.00, and Overhead $4.10

During 2009 28,500 units produced with the following costs per unit:

Material $11.50, Labor $4.80, and Overhead $6.20

Sales in units 31,500 at $29.60 each

Inventory method is LIFO

Required: Find the gross profit and ending inventory.

WHEELS

Sales Projected in Units 31,500

Sales Price $29,60

Sales Revenue $932,400

Cost of Goods Sold

BI – Beginning Inventory 7,000 units

Cost per Unit Material $16*85=$1,360

Remaining Units (1,000-85)=

=915*$18=$16,470

Cost of Goods Sold

Gross Profit $12,170

Beginning Inventory $4,960

Total Production Costs $62,710

Total Inventory Available for Sale $67,670

Costs of Goods Sold

Ending Inventory...