In Your Internship with Lewis,Lee,& Taylor Inc A) -$14,440
B)-$15,200
C) -$16,000
D) -$16,800
E)-$17,640

question 34

Multiple Choice

In your internship with Lewis,Lee,& Taylor Inc.you have been asked to forecast the firm's additional funds needed (AFN) for next year.The firm is operating at full capacity.Data for use in your forecast are shown below.Based on the AFN equation,what is the AFN for the coming year? $\begin{array}{lrlr}\text { Last year's sales }=S_{0} & \$ 200,000 & \text { Last year's accounts payable } & \$ 50,000 \\\text { Sales growth rate }=g & 40 \% & \text { Last year's notes payable } & \$ 15,000 \\\text { Last year's total assets }=\mathrm{A}_{0} * & \$ 135,000 & \text { Last year's accruals } & \$ 20,000 \\\text { Last year's profit margin }=\text { PM } & 20.0 \% & \text { Target payout ratio } & 25.0 \%\end{array}$

• A) -$14,440
• B)-$15,200
• C) -$16,000
• D) -$16,800
• E)-$17,640

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Definitions:

Inventory Holding Cost

The total cost incurred by holding inventory, including storage, insurance, spoilage, and opportunity costs.

Carrying Costs

Expenses associated with maintaining inventory, including storage, insurance, and opportunity costs.

Cycle Counting

An approach to stock audit where a limited selection of the inventory at a defined site is enumerated on a chosen date.

Service Level

A measure of the performance of a service system, often defined in terms of responsiveness to customer needs and reliability.