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Q: How much additional external capital will be required for next year if sales increase 15 percent?

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sources of finance is where a business can get money from. there are two types where money can be found internal and external. internal are things like the owner's capital and external are things like loans.

A 5% increase means that your capital increases by a factor of 1.05 each year. After three years, your capital will increase by a factor of 1.05 x 1.05 x 1.05, or 1.053. Calculate this and multiply it by the initial capital.

It helps calculations if you think about compound interest as your money increasing every period (for instance, every year) by a certain factor. For example, if you get 5% interest per annum, your capital will increase by a factor of 1.05 every year. If you repeat this, say, 10 years, then your capital will obviously increase by a factor of 1.0510.The detailed formula for the capital you have after a number of periods is thus:(initial capital) x (1 + rate/100)periodsIf you want to know only how much interest you earned, rather than the total money you'll have, just subtract the initial capital.

The IRR rule states that if the internal rate of return (IRR) on a project or investment is greater than the minimum required rate of return - the cost of capital - then the decision would generally be to go ahead with it. Conversely, if the IRR on a project or investment is lower than the cost of capital, then the best course of action may be to reject it.

You're capital loss carry forward can be written against the gains. The 3,000 applies only in EXCESS of capital gains. Therefore you can write off 103,000 and carry forward the balance.Year 1: 200k capital loss. Write off 3,000 carry over 197,000Year 2: 100k Capital gain - 100k capital loss (out of the 197) plus an additional 3k against ordinary income. Carry forward 94k of Capital loss for next year.http:/www.fairmark.com/capgain/capgain.htm

Related questions

Increase capital through additional investment of the owner, increase in income Decrease capital through withdrawal of the money made by the owner, incur losses

Additional Capital Contributions to a business does not increase taxes. Increased earnings does.

If you mean additional capital investment, YES in terms of amount BUT NOT necessarily in terms of percentage.

debit cashcredit share capital

Retained earning only increased due to prior year operating profits and that's why it has no effect of any kind of additional capital introduced which directly increase the subscribed or paid up capital and not retained earnings.

- By generating GAAP earnings and not paying them as dividends - the retained earnings will increase. - By selling and increasing outstanding number of shares - the paid in capital will increase.

the Journal entry for Additional capital brought to business partner Capital A/c Dr. To Partner Capital A/c

how do capital and human capital increase the gdp wealth and income of nations

Additional Paid-in Capital is a normal credit balance account.

Additional paid in capital is also part of paid in capital of business and shown as an addition to already exists paid in capital of business.

A business uses capital for research and development. Capital is also required for business expansion and for reducing operating costs. Capital is also needed to buy other businesses, which allows it to diversify. Verizon for example has capital to buy AOL and increase its exposure to more Internet business.

Capital account increases when capital is introduced, shares are issued, increase in retained profits, etc.