Increase at same rate sales-self-supporting growth rate

Assignment Help Financial Management

Reference no: EM13808660

Maggie's Muffins, Inc., generated $4,000,000 in sales during 2013, and its year-end total assets were $2,400,000. Also, at year-end 2013, current liabilities were $1,000,000, consisting of $300,000 of notes payable, $500,000 of accounts payable, and $200,000 of accruals. Looking ahead to 2014, the company estimates that its assets must increase at the same rate as sales, its spontaneous liabilities will increase at the same rate as sales, its profit margin will be 4%, and its payout ratio will be 50%. How large a sales increase can the company achieve without having to raise funds externally; that is, what is its self-supporting growth rate? Do not round intermediate steps. Round your answers to the nearest whole.

Reference no: EM13808660

Questions Cloud

What is average amount of receivables-days sales outstanding : Snider Industries sells on terms of 3/10, net 30. Total sales for the year are $1,619,000. Thirty percent of the customers pay on the 10th day and take discounts; the other 70% pay, on average, 70 days after their purchases. What is the days sales ou..

What specific pricing strategies does the retailer implement : What specific pricing strategies does the retailer implement? Company The home depot How does the retailer determine initial markups? What is the retailer's markdown policy? The Home depot

What type of product is philip morris'' heatstick : What type of product is Philip Morris' HeatStick? Use the terminology from the background materials to classify this product, and pay close attention to the "Classification of products" and the "Different types of new products" sections of Chapter 5..

Related to the length of maturity and coupon rate : Explain the interest rate risk and how it is related to the length of maturity and coupon rate.

Increase at same rate sales-self-supporting growth rate : Maggie's Muffins, Inc., generated $4,000,000 in sales during 2013, and its year-end total assets were $2,400,000. Also, at year-end 2013, current liabilities were $1,000,000, consisting of $300,000 of notes payable, $500,000 of accounts payable, and ..

Weighted average cost-after-tax cost of debt for the firm : Your firm is considering a new investment proposal and would like to calculate the weighted average cost of capital. A bond that has a $1,000 par value (face value) and a contract or coupon interest rate of 12.1% that is paid semi annually. The bond ..

What is training & development in coca cola as a company : 3-4 pages overall for the 5 topics with references. Dont need running headers, just citations. This needs to be written from an international human resource management side. What is Training & Development in Coca Cola as a company

Developing an asset financing plan : Christensen & Assoc. is developing an asset financing plan. Christensen has $1,000,000 in current assets, of which 15% are permanent, and $700,000 in fixed assets. The current long-term rate is 9%, and the current short-term rate is 6.5%. Christensen..

How did modern hollywood shape contemporary hollywood : How did "modern Hollywood" shape contemporary Hollywood? What type of movies were 'modern era'?

User Account

All Pages