14-6)  Following are financial statements for the Genatron Manufacturing corporation for 2012 and 2011.

GENATRON MANUFACTURING CORPORATION

Balance Sheet                                                                  2012                                            2011

Assets

Cash                                                       $40,000                                    $50,000

Accts. Receivable                                      260,000                                     20,000

Inventory                                                 500,000                                     450,000

Total current assets                                   800,000                                     700,000

Fixed assets, net                                       400,000                                     300,000

Total assets                                          $1,200,000                                $1,000,000

LIABILITIES AND EQUITY                    2012                              2011

Accts. Payable                             $170,000                  130,000

Bank Loans                                    90,000                    90,000

Accruals                                         70,000                    50,000

Total current liabilities                    330,000                  270,000

Long-term debt, 12%                     400,000                  300,000

Common stock, $10 par                 300,000                  300,000

Capital surplus                               50,000                    50,000

Retained earnings                        120,000                    80,000

Total liabilities & equity            $1,200,000              $1,000,000

INCOME STATEMENT                                              2012                                        2011

Net sales                                              $1,500,000                   $1,300,000

Cost of goods                                            900,000                       780,000

Gross Profit                                                600,000                       520,000

Expenses: general and admin                      150,000                       150,000

Marketing                                                  150,000                       130,000

Depreciation                                                53,000                         40,000

Interest                                                      57,000                         45,000

Earnings before taxes                                 190,000                       155,000

Income taxes                                              76,000                        62,000

Net income                                              $114,000                       $93,000

14-7)  This problem uses the financial statements for the Genatron Manufacturing corporation for the years 2012 and 2011 from Problem 6.

14-8)  Genatron manufacturing expects its sales to increase by 10 % in 2013.  Estimate the firm's external financing needs by using the percent-of-sales method for the 2012 data.