a. If sales increase by 20% in 2020 and the company uses a strict percentage of sales planning model (meaning that all items on the income and balance sheet also increase by 20%), what must be the balancing item? b. What will be the value of this balancing item?

a. If sales increase by 20% in 2020 and the company uses a strict percentage of sales planning model (meaning that all items on the income and balance sheet also increase by 20%), what must be the balancing item? b. What will be the value of this balancing item?

Entrepreneurial Finance

6th Edition

ISBN:9781337635653

Author:Leach

Publisher:Leach

Chapter9: Projecting Financial Statements

Section9.4: Estimating Additional Financing Needed To Support Growth

Problem 3CC

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a. If sales increase by 20% in 2020 and the company uses a strict percentage of sales planning model (meaning that all items on the
income and balance sheet also increase by 20%), what must be the balancing item?
b. What will be the value of this balancing item?

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