Financing Costs of Additional Funds Needed: A Modified Equation Approach.
- UNCG Author/Contributor (non-UNCG co-authors, if there are any, appear on document)
- Daniel T. Winkler, Professor (Creator)
- Institution
- The University of North Carolina at Greensboro (UNCG )
- Web Site: http://library.uncg.edu/
Abstract: The additional funds needed (AFN) equation is a popular forecasting model for estimating additional funds requirements (Brigham [3]). Academicians regard the AFN equation as an excellent pedagogical tool; practitioners find it highly beneficial for many forecasting needs. To apply the model, an analyst needs to know the amount of assets required per dollar of sales, the amount of spontaneous liabilities available per dollar of sales, the change in sales, and additions to retained earnings. Additions to retained earnings are calculated by multiplying the net profit margin by forecasted sales and the retention ratio.
Financing Costs of Additional Funds Needed: A Modified Equation Approach.
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Created on 1/1/1994
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Additional Information
- Publication
- Financial Education and Practice, Summer 1994, pp. 149-154
- Language: English
- Date: 1994
- Keywords
- Additional funds needed (AFN) equation