What is the external financing needed

Assignment Help Financial Management
Reference no: EM131819155

1. All else equal (that's important), an increase in which one of the following will increase net income?

a. Marginal tax rate

b. Depreciation

c. Fixed costs

d. Dividends

e. Revenue

2. The CEO of JFK Corporation would like to grow sales to $599,500 next year. Assets and costs will grow proportionate to sales, but debt and equity will not. The dividend payout ratio will remain the same as current year. What is the external financing needed?

Sales            550,000

Costs           450,000

Tax rate        35%

Dividends     29,900

Assets          500,000

Debt            200,000

Equity          300,000

Reference no: EM131819155

Questions Cloud

Explain the concept of liquidity risk : What is the link between inflation and interest rates when looking at Mortgages? Explain the concept of Liquidity Risk?
Compute incremental cash flows of investment for each year : The Dante Manufacturing Company is considering a new investment. Compute the incremental cash flows of the investment for each year
What will be the value of your investment : What will be the value of your investment in Class A and Class B shares if the shares are sold after 4 years?
Firm will generate net after-tax cash flow : A firm will generate a net after-tax cash flow of $100,000 one year from today. if the appropriate discount rate is 10 percent compounded semiannually?
What is the external financing needed : The CEO of JFK Corporation would like to grow sales to $599,500 next year. What is the external financing needed?
Outline three different types of financial frictions : Outline three different types of financial frictions that impact on capital structure decisions.
What is financial break-even point for the project : The appropriate discount rate is 10 percent. What is the financial break-even point for the project?
Should you buy the new or used equipment based on comparison : A piece of new equipment costs $15,000. Should you buy the new or used equipment based on a comparison over three years on a yearly basis?
What is a long-lived asset : The other use of funds for a company is long-lived assets. What is a long-lived asset?

Reviews

Write a Review

Financial Management Questions & Answers

  How much of payment will go toward principal of loan

You have just taken out a $22,000 car loan with a 6% APR, compounded monthly. The loan is for five years. When you make your first payment in one month, how much of the payment will go toward the principal of the loan and how much will go toward inte..

  About the short selling

You are bearish on GE because of the global economic slowdown and expect a sharp drop in its share price. So you short 1,000 shares of GE at $20 per share. If the initial margin requirement is 55%, how much additional collateral do you need to post? ..

  Newly acquired knowledge of time value of money

Give an example of how your newly acquired knowledge of Time Value of Money (TVM) calculations could better prepare you for the next negotiation or big-ticket purchase in your life.

  Prepare depreciation schedule for the assets

Prepare a depreciation schedule for the assets in the below transactions using straight line method of depreciation:  Calculate any gain or loss and show the appropriate journal entry.

  What would be the cost of new equity

Cost of Common Equity with Flotation Banyan Co.’s common stock currently sells for $53.25 per share. What would be the cost of new equity?

  Payback years should the project be accepted or rejected

Suppose your firm is considering investing in a project with the cash flows shown below, Payback years Should the project be accepted or rejected?

  Additional funds needed for the coming year

The Booth Company's sales are forecasted to double from $1,000 in 2012 to $2,000 in 2013. What is Booth's additional funds needed (AFN) for the coming year?

  Cash flow for operations is projected

Each party invests its capital at the beginning of the first year and cash flow for operations (NOI) is projected as follows:

  What is the partial valuation equation for this investment

Now EBV is considering a 2X liquidation preference on the RP. What is the partial valuation equation for this investment?

  Discuss the capital costs and required capacity factor

Research and build a data file including 24 h of electrical demand data for 30 residences, 15 shops, and 5 factories, along with some wind speed data.

  Compounded continuously-what is the current stock price

If the risk-free rate is 4.2 percent per year, compounded continuously, what is the current stock price?

  How many additional dollars of interest

How many additional dollars of interest would you earn over 44 years from the account that pays 6.66.6?%?

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd