Reference no: EM133071479

Question - Long-term financing needed - At year-end 2014, total assets for Ambrose Inc. were $1.7 million and accounts payable were $320,000. Sales, which in 2014 were $2.9 million, are expected to increase by 25% in 2015. Total assets and accounts payable are proportional to sales, and that relationship will be maintained; that is, they will grow at the same rate as sales. Ambrose typically uses no current liabilities other than accounts payable. Common stock amounted to $495,000 in 2014, and retained earnings were $255,000. Ambrose plans to sell new common stock in the amount of $110,000. The firm's profit margin on sales is 5%; 65% of earnings will be retained.

What was Ambrose's total debt in 2014? Write out your answer completely. For example, 25 million should be entered as 25,000,000.

How much new long-term debt financing will be needed in 2015? Write out your answer completely. For example, 25 million should be entered as 25,000,000.