External sources to fund the expected growth

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Reference no: EM132028736

Super Fun Toys, Inc., has the following balance sheet: Assets Liabilities and Equity Current assets $3,500,000 Current liabilities $2,400,000 Fixed assets 5,100,000 Long-term debt 2,100,000 Equity 4,100,000 Total assets $8,600,000 Total liabilities & equity $8,600,000 Suppose Super Fun Toys, Inc., has sales of $8.9 million for the year just ended, the profit margin of the firm is 16 percent with a retention rate of 28 percent, and the firm expects sales of $10.8 million next year. If fixed assets will have to grow by $800,000 to support the sales growth, with current assets and current liabilities expected to grow with sales, what amount of additional funds will Super Fun Toys need from external sources to fund the expected growth?

Reference no: EM132028736

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