The most recent financial statements for Beckett Co. are shown here: INCOME STATEMENT BALANCE SHEET Sales $ 75,500 Current assets $ 21,000 Long-term debt $ 54,000 Costs 59,400 Fixed assets 148,000 Equity 115,000 Taxable income $ 16, 100 Total $ 169,000 Total $ 169,000 Taxes (22%) 3,542 Net income $ 12,558 Assets and costs are proportional to sales. The company maintains a constant 30 percent dividend payout ratio and a constant debt - equity ratio. What is the maximum increase in sales that can be sustained assuming no new equity is issued? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.)

The most recent financial statements for Beckett Co. are shown here: INCOME STATEMENT BALANCE SHEET Sales $ 75,500 Current assets $ 21,000 Long-term debt $ 54,000 Costs 59,400 Fixed assets 148,000 Equity 115,000 Taxable income $ 16, 100 Total $ 169,000 Total $ 169,000 Taxes (22%) 3,542 Net income $ 12,558 Assets and costs are proportional to sales. The company maintains a constant 30 percent dividend payout ratio and a constant debt - equity ratio. What is the maximum increase in sales that can be sustained assuming no new equity is issued? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.)

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

Section: Chapter Questions

Problem 22BEA: The income statement, statement of retained earnings, and balance sheet for Somerville Company are...

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