How large of sales increase can the company achieve

Assignment Help Financial Management

Reference no: EM131825466

Paladin Furnishings generated $4 million in sales during 2016, and its year-end total assets were $2.6 million. Also, at year-end 2016, current liabilities were $500,000, consisting of $200,000 of notes payable, $200,000 of accounts payable, and $100,000 of accrued liabilities. Looking ahead to 2017, the company estimates that its assets must increase by $0.65 for every $1.00 increase in sales. Paladin's profit margin is 7%, and its retention ratio is 45%. How large of a sales increase can the company achieve without having to raise funds externally? Write out your answer completely. For example, 25 million should be entered as 25,000,000. Do not round intermediate calculations. Round your answer to the nearest cent.?

Reference no: EM131825466

Questions Cloud

Amounts relating to this mortgage : She wants your help in determining the following amounts relating to this mortgage:

What is MPIs times-interest-earned ratio : Its basic earning power (BEP) ratio is 8%, and its return on assets (ROA) is 3%. What is MPI's times-interest-earned (TIE) ratio?

Same expected returns and standard deviation of returns : Two securities that have the same expected returns and standard deviation of returns would offer diversification benefits to investors under what condition?

Additional funds carlsbad will need for the coming year : Use the AFN equation to forecast the additional funds Carlsbad will need for the coming year.

How large of sales increase can the company achieve : How large of a sales increase can the company achieve without having to raise funds externally?

Working to change workers compensation laws : A number of professional team owners are working to change workers’ compensation ( WC ) laws in Illinois.

Each of the next eight years in order to achieve this goal : what equal annual deposits must Peter make at the end of each of the next eight years in order to achieve this goal?

Use falsification exercise : you use a “falsification exercise”, you observe the new car purchasing behavior of families with children graduating in 2015.

What is the firm cost of external common equity : What is the firm's cost of internal common equity? What is the firm's cost of external common equity?

User Account

All Pages