ÿþ<HTML> <HEAD> <TITLE>Working Capital Needs</TITLE> <META HTTP-EQUIV="Content-Type" CONTENT="text/html; charset=iso8859-1"> <META NAME="description" CONTENT="Financial Calculators, ©1998-2010 KJE Computer Solutions, LLC. For more information please see http://www.dinkytown.net"> <STYLE> <!-- BODY, TABLE, TD, TH, UL, OL, DD, DL, P, BR { font-family: helvetica, arial, sans-serif; font-size: 10pt; } H1 { font-family: helvetica, arial, sans-serif; font-size: 13pt; font-weight: bold; } DT { font-family: helvetica, arial, sans-serif; font-size: 10pt; font-weight: bold; } P.footer { font-family: helvetica, arial, sans-serif; font-size: 9pt; } DIV.large { font-family: helvetica, arial, sans-serif; font-size: 13pt; font-weight: bold; } --> </STYLE> </HEAD> <!-- Financial Calculators, ©1998-2008 KJE Computer Solutions, LLC. 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For more information please see: <A HREF="http://www.dinkytown.net">http://www.dinkytown.net</A> --> <H1>Working Capital Needs</H1><P>Your working capital is used to pay short-term obligations such as your accounts payable and buying inventory. If your working capital dips too low, you risk running out of cash. Even very profitable businesses can run into trouble if they lose the ability to meet their short-term obligations. The calculator assists you in determining working capital needs for the next year.<P><CENTER> <!--[if IE]><object name="calculator" classid="clsid:8AD9C840-044E-11D1-B3E9-00805F499D93" codebase="http://java.sun.com/update/1.6.0/jinstall-6-windows-i586.cab#Version=1,4,0,0" height="400" width="565"><param name="code" value="Capital" /><param name="archive" value="dinkytown.jar" /> <P style="font-size:1px; color: #ffffff" line-height: 1px><![endif]--><![if !IE]><P style="font-size:1px; color: #ffffff" line-height: 1px><![endif]></P><![if !IE]><APPLET name="calculator" code="Capital.class" align="baseline" WIDTH="565" HEIGHT="400" archive="dinkytown.jar"><![endif]> <PARAM name="TOTAL_CURRENT_ASSETS" value="20000"> <PARAM name="TOTAL_CURRENT_LIABILITIES" value="12000"> <PARAM name="ANNUAL_DESIRED_GROWTH" value="20"> <PARAM name="TARGET_CURRENT_RATIO" value="2.0"> <!--CUSTOM PARAMETERS--> <PARAM name="TEXT_FOR_REPORT" value="<HTML> <HEAD> <TITLE>Working Capital Needs</TITLE> <META HTTP-EQUIV='Content-Type' CONTENT='text/html; charset=iso8859-1'> <META NAME='description' CONTENT='Financial Calculators, &QCPQ;1998-2010 KJE Computer Solutions, LLC. For more information please see http://www.dinkytown.net'> <STYLE> <!-- BODY, TABLE, TD, TH, UL, OL, DD, DL, P, BR { font-family: helvetica, arial, sans-serif; font-size: 10pt; } H1 { font-family: helvetica, arial, sans-serif; font-size: 13pt; font-weight: bold; } DT { font-family: helvetica, arial, sans-serif; font-size: 10pt; font-weight: bold; } P.footer { font-family: helvetica, arial, sans-serif; font-size: 9pt; } DIV.large { font-family: helvetica, arial, sans-serif; font-size: 13pt; font-weight: bold; } --> </STYLE> </HEAD> <BODY bgcolor='#FFFFFF' LINK='#003399' VLINK='#666666' BGCOLOR='#FFFFFF'> <CENTER><table border=0 bgcolor='#000000' width=468 cellspacing=1 cellpadding=0><tr><td width='100%'><table bgcolor='#FFFFDD' border=0 width=468 cellspacing=1 cellpadding=5><tr><td width='100%' align=center valign=middle><DIV class=large>Working Capital Needs</DIV></td></tr></table></TD></TR></TABLE></CENTER> <H1>WORKING_CAPITAL_CHANGE</H1>To maintain a current ratio of TARGET_CURRENT_RATIO you need a total of TARGET_WORKING_CAPITAL in working capital. Your actual working capital is ACTUAL_WORKING_CAPITAL with a current ratio of ACTUAL_CURRENT_RATIO. If you grow ANNUAL_DESIRED_GROWTH per year in MONTHS_OF_ANALYSIS months you will need TARGET_WORKING_CAPITAL_END of working capital. This will keep your current ratio at TARGET_CURRENT_RATIO. This assumes that both your current liabilities and current assets increase at an annual rate of ANNUAL_DESIRED_GROWTH. <P>**GRAPH**<P> <CENTER><table border=0 bgcolor='#000000' width=95% cellspacing=1 cellpadding=0><tr><td width='100%'><table bgcolor='#FFFFFF' border=0 width=100% cellspacing=1 cellpadding=5> <TR BGCOLOR='#CCCCCC'><TD COLSPAN=4><CENTER><B>Results Summary</B></CENTER></TD></TR> <TR BGCOLOR='#CCCCCC'> <TD><CENTER><B>&NBSP;</B></CENTER></TD> <TD><CENTER><B>Actuals</B></CENTER></TD> <TD><CENTER><B>Target Month 1</B></CENTER></TD> <TD><CENTER><B>Target Month MONTHS_OF_ANALYSIS</B></CENTER></TD> </TR> <TR><TD><b>Current ratio </b> </TD><TD>ACTUAL_CURRENT_RATIO </TD> <TD>TARGET_CURRENT_RATIO </TD><TD>TARGET_CURRENT_RATIO </TD></TR> <TR><TD><b>Working capital </b> </TD><TD>ACTUAL_WORKING_CAPITAL</TD><TD><B>TARGET_WORKING_CAPITAL</B></TD><TD><B>TARGET_WORKING_CAPITAL_END</B></TD></TR> </TABLE></TD></TR></TABLE> <BR> </CENTER> <P><CENTER><table border=0 bgcolor='#000000' width=95% cellspacing=1 cellpadding=0><tr><td width='100%'><table bgcolor='#FFFFFF' border=0 width=100% cellspacing=1 cellpadding=5> <TR BGCOLOR='#CCCCCC'><TD COLSPAN=2><CENTER><B>Input Summary</B></CENTER></TD></TR> <TR><TD><b>Total current assets </b> </TD><TD>TOTAL_CURRENT_ASSETS </TD></TR> <TR><TD><b>Total current liabilities </b> </TD><TD>TOTAL_CURRENT_LIABILITIES </TD></TR> <TR><TD><b>Annual growth rate </b> </TD><TD>ANNUAL_DESIRED_GROWTH </TD></TR> <TR><TD><b>Current ratio target </b></TD><TD>TARGET_CURRENT_RATIO </TD></TR> </TABLE></TD></TR></TABLE></CENTER> <P><DIV class=large>Working capital estimates for the next MONTHS_OF_ANALYSIS months</DIV> <HR SIZE=1> **REPEATING GROUP** <BR> <P class=footer>*Required total assets to meet current ratio target of TARGET_CURRENT_RATIO </P> <BR> <HR SIZE=1> <CENTER><P class=footer> Information and interactive calculators are made available to you as self-help tools for your independent use and are not intended to provide investment advice. We cannot and do not guarantee their applicability or accuracy in regards to your individual circumstances. All examples are hypothetical and are for illustrative purposes. We encourage you to seek personalized advice from qualified professionals regarding all personal finance issues. </P></CENTER><br><br> </BODY> </HTML> "> <H1><CENTER>This Financial Calculator requires SUN's Java"! Plug-in. If you see this message you will need to download SUN's Java"! Plug-in. This can be done automatically by clicking the yellow bar at the top of your browser and choosing  Install ActiveX Control . </CENTER></H1> <OL> You can also get SUN's Java"! Plug-in here: <A href="http://www.java.com/en/download/download_the_latest.jsp" target=_blank><b>Get the Java"! Plug-in!</b></A> <P>For more information about this Plug-in please visit: <A href="http://www.dinkytown.net/money/sunjvm.html" target=_blank><b>SUN's Java"! Plug-in</b></A> <BR>For more information these financial calculators please visit: <A href="http://www.dinkytown.net" target=_blank><b>Financial Calculators from KJE Computer Solutions, LLC</b></A> </OL><!--[if IE]></OBJECT><![endif]--><![if !IE]></APPLET><![endif]> </CENTER><CENTER><SCRIPT>document.write(showbuttons())</SCRIPT> </CENTER> <H1>Definitions</H1><P><TABLE align='center' WIDTH="95%"><TR><TD><DL><!--DEFN_START--> <DT><B>Annual growth</B><DD>The percent of growth you expect over the next year.<P> <DT><B>Total current assets</B><DD>This is any cash or asset that can be quickly turned into cash. This includes prepaid expenses, accounts receivable, most securities and your inventory.<P> <DT><B>Total current liabilities</B><DD>This is a liability in the immediate future. This includes wages, taxes, and accounts payable.<P> <DT><B>Current ratio</B><DD>Current Assets divided by current liabilities. Your current ratio helps you determine if you have enough working capital to meet your short-term financial obligations. A general rule of thumb is to have a current ratio of 2.0. Although this will vary by business and industry, a number above two may indicate a poor use of capital. A current ratio under two may indicate an inability to pay current financial obligations with a measure of safety.<P> <DT><B>Working capital</B><DD>Working capital is used by lenders to help gauge the ability for a company to weather difficult financial periods. Working capital is calculated by subtracting current liabilities from current assets. Due to differences in businesses and the fact that working capital is not a ratio but an absolute amount, it is difficult to predict what the ideal amount of working capital would be for your business. To calculate working capital requirements this calculator uses the "Current Ratio" to determine a target amount of working capital. See the "Current Ratio" definition for more information. <!--DEFN_END--></DL></TD></TR></TABLE> <BR> <HR SIZE=1> <CENTER> <P class=footer> Information and interactive calculators are made available to you as self-help tools for your independent use and are not intended to provide investment advice. We cannot and do not guarantee their applicability or accuracy in regards to your individual circumstances. All examples are hypothetical and are for illustrative purposes. We encourage you to seek personalized advice from qualified professionals regarding all personal finance issues. </P></CENTER> <BR> </BODY> </HTML>