Additional Funds Needed (AFN) Calculator
Get a clear picture of the additional funds your business needs for growth with AFN Calculator. Includes a simple pie chart visualization for easy decision-making.
Result
Additional Funds Needed (AFN)
$0
Additional Funds Needed Formula
The formula for calculating AFN is:
AFN = (A*/S0) * S - (L*/S0) * S - MS1
Where:
A*
= projected total assetsS0
= current salesS
= projected salesL*
= projected total liabilitiesMS1
= additional external financing required
Additional Funds Needed Example
Suppose ABC Corp. is planning for next year and has projected the following financial data:
- Projected total assets (A*): $500,000
- Current sales (S0): $1,000,000
- Projected sales (S): $1,200,000
- Projected total liabilities (L*): $350,000
- External financing available: $100,000
Using the AFN formula, we can calculate the additional funds needed:
AFN = ($500,000/$1,000,000) * $1,200,000 - ($350,000/$1,000,000) * $1,200,000 - $100,000
AFN = $240,000 - $420,000 - $100,000
AFN = -$280,000
Based on this calculation, ABC Corp. would need an additional $280,000 in external financing to support its projected growth.
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