As at december 31-2012 a company has total assets of 3500

Reference no: EM13588900

Q 1) As at December 31-2012, a company has total assets of $3,500 {current assets of $1,500 and fixed assets of $2,000}, debt of $2,250 {current liabilities of $1,000 and long-term debt of $1,250} and equity of $1,250 {retained earnings}. For the year ending December 31-2012, total sales were $10,000 and total costs (including taxes) were $7,000.

a) Going forward, if the company experiences a 10% increase in sales, all balance sheet items increase by 10%. What is the firm's dividend payout ratio? With respect to the cost structure the production manager has advised that the margins will remain the same with any increase in sales. What amount of external financing (EFN) was needed (if any)?

b) If the dividend payout ratio changes to 50%, how does this affect your EFN? Explain/illustrate.

Reference no: EM13588900

Questions Cloud

What is the difference between a data flow diagram for the : what is the difference between a data flow diagram for the sales process and a system flowchart describing the sales

What are internal controls why do companies need them what : what are internal controls? why do companies need them? what are some examples of internal controls? who is responsible

A company has total assets of 20000 debt of 7500 and : a company has total assets of 20000 debt of 7500 and equity of 12500. sales are 10000 amp costs are 7000 the dividend

Prepare profit reports for software and consulting assuming : icon.com sells software and provides consulting services to companies that conduct business over the internet. the

As at december 31-2012 a company has total assets of 3500 : q 1 as at december 31-2012 a company has total assets of 3500 current assets of 1500 and fixed assets of 2000 debt of

Given a business scenario that requires the use of : given a business scenario that requires the use of healthcare information technology analyze evaluate and recommend a

What would kutty industriess cost of goods sold had been if : 1.odaine also disclosed that bad debt expense was 1200 in 2012 and 990 in 2011. there were no recoveries of

What are the four symbols used in a data flow diagram and : what are the four symbols used in a data flow diagram and what does each of the symbols mean? and what is the

In a computerized environment you learn about the : in a computerized environment you learn about the relationship between peachtree and the fundamental accounting

User Account

All Pages