A firm has current assets of $1,600, net fixed assets of $6,000, accounts payable of $800, long-term debt of $2,400, equity of $4,400, sales of $7,500, costs of $5, 300, and a tax rate of 35 percent. Assume costs, accounts payable, and current assets all increase at the same rate as sales. Also, assume 60 percent of net income is paid out in dividends and that the firm is currently operating at 90 percent of capacity. If sales grow at 20 percent, compute the external financing need. In your answer prepare an income statement and balance sheet (Insert a Table)
A firm has current assets of $1,600, net fixed assets of $6,000, accounts payable of $800, long-term debt of $2,400, equity of $4,400, sales of $7,500, costs of $5, 300, and a tax rate of 35 percent. Assume costs, accounts payable, and current assets all increase at the same rate as sales. Also, assume 60 percent of net income is paid out in dividends and that the firm is currently operating at 90 percent of capacity. If sales grow at 20 percent, compute the external financing need. In your answer prepare an income statement and balance sheet (Insert a Table)
Intermediate Accounting: Reporting And Analysis
3rd Edition
ISBN:9781337788281
Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Chapter5: The Income Statement And The Statement Of Cash Flows
Section: Chapter Questions
Problem 1RE: Brandt Corporation had sales revenue of 500,000 for the current year. For the year, its cost of...
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