Finding additional financing

Reference no: EM1345661

ICU has current assets of $800,000 and net fixed assets of $1,400,000. The firm expects its sales to climb 25 percent next year from its current level of $3,500,000. ICU's only current liability is accounts payable of $1,200,000. If both current assets and current liabilities will increase proportionately with sales, what additional financing will be needed by ICU next year? Assume ICU has a net profit margin of 6 percent. An increase in net fixed assets of $500,000 will be required. The firm pays out 50 percent of its earnings as dividends.

Reference no: EM1345661

Questions Cloud

Question about project choices : The new financial analyst does not like the paybak approach in - 35091 - and evaluates that the firm's required rate of return is 15

Calculate the expected npv & coefficient of variation : Trail Guides, Corporation, is currently evaluating 2 mutually exclusive investment. After doing a scenario analysis & applying probabilities to every scenario;

Elucidate why not and propose a mechanism : elucidate why not and propose a mechanism that might solve your dilemma.

The paybak criterion and which is the most desirable project : Which need an initial investment of $30,000 and provide cash inflows of $60,000 as shown below. This organization has a 15% cost of capital.

Finding additional financing : ICU has current assets of $800,000 and net fixed assets of $1,400,000. The company expects its sales to climb 25% next year from its current level of $3,500,000.

Explain how can we lower the pitch of a note on a guitar : A 12kg runaway grocery cart runs into a spring with spring constant 210 N/m and compresses it by 70 cm .What was the speed of the cart just before it hit the spring.

Explain why new soft drink is the most profitable strategy : If you were a manager at PepsiCo, would you try to convince your colleagues while introducing the new soft drink is the most profitable strategy.

Explain about osi reference model : Explain about OSI Reference Model - The OSI reference model divides network operation and management into seven layers.

Project management and change : Explain what kinds of changes could impact the project you are managing and how might those changes be handled?

User Account

All Pages