Owen’s Electronics has nine operating plants in seven southwestern states. Sales for last year were $100 million, and the balance sheet at year-end is similar in percentage of sales to that of previous years (and this will continue in the future). All assets (including fixed assets) and current liabilities will vary directly with sales. Balance Sheet(in $ millions)AssetsLiabilities and Stockholders' EquityCash$5Accounts payable$18Accounts receivable 23Accrued wages 5Inventory 26Accrued taxes 11Current assets$54Current liabilities$34Fixed assets 43Notes payable 13 Common stock 18 Retained earnings 32Total assets$97Total liabilities and stockholders' equity$97 Owen’s Electronics has an aftertax profit margin of 8 percent and a dividend payout ratio of 30 percent. If sales grow by 15 percent next year, determine how many dollars of new funds are needed to finance the growth. (Do not round intermediate calculations. Enter your answer in dollars, not millions, (e.g., $1,234,567).)

According to the percentage of sales method, the accounts in the balance sheet possess a percentage…

Answered: Owen’s Electronics has nine operating…

Managerial Accounting: The Cornerstone of Business Decision-Making

7th Edition

ISBN:9781337115773

Author:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger

Publisher:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger

Chapter15: Financial Statement Analysis

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Problem 51E: Juroe Company provided the following income statement for last year: Juroes balance sheet as of...

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Owen’s Electronics has nine operating plants in seven southwestern states. Sales for last year were $100 million, and the balance sheet at year-end is similar in percentage of sales to that of previous years (and this will continue in the future). All assets (including fixed assets) and current liabilities will vary directly with sales.

Balance Sheet (in $ millions)
Assets	Liabilities and Stockholders' Equity
Cash	$	5	Accounts payable	$	18
Accounts receivable		23	Accrued wages		5
Inventory		26	Accrued taxes		11
Current assets	$	54	Current liabilities	$	34
Fixed assets		43	Notes payable		13
			Common stock		18
			Retained earnings		32
Total assets	$	97	Total liabilities and stockholders' equity	$	97

Owen’s Electronics has an aftertax profit margin of 8 percent and a dividend payout ratio of 30 percent.

If sales grow by 15 percent next year, determine how many dollars of new funds are needed to finance the growth. (Do not round intermediate calculations. Enter your answer in dollars, not millions, (e.g., $1,234,567).)

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