A company's sales in 2020 were $3.8 million and its total spontaneous se the firm's spontaneous liabilities consisted of $8.3 milllion in wages payable, $8.8 million in accounts payable, and $5.1 million in accrued expenses. The firm's profit margin is 9.7% and Its dividend payout ratio is 9.1%. The balance sheet at year-end is similar in percentage of sales to that of previous years and this will continue in the future. Required: What is the percentage increase in sales that the company must achieve in order to avoid raising funds externally?

A company's sales in 2020 were $3.8 million and its total spontaneous se the firm's spontaneous liabilities consisted of $8.3 milllion in wages payable, $8.8 million in accounts payable, and $5.1 million in accrued expenses. The firm's profit margin is 9.7% and Its dividend payout ratio is 9.1%. The balance sheet at year-end is similar in percentage of sales to that of previous years and this will continue in the future. Required: What is the percentage increase in sales that the company must achieve in order to avoid raising funds externally?

Intermediate Financial Management (MindTap Course List)

13th Edition

ISBN:9781337395083

Author:Eugene F. Brigham, Phillip R. Daves

Publisher:Eugene F. Brigham, Phillip R. Daves

Chapter7: Analysis Of Financial Statements

Section: Chapter Questions

Problem 12P: The Kretovich Company had a quick ratio of 1.4, a current ratio of 3.0, a days’ sales outstanding of...

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The Kretovich Company had a quick ratio of 1.4, a current ratio of 3.0, a days’ sales outstanding of 36.5 days (based on a 365-day year), total current assets of $810,000, and cash and marketable securities of $120,000. What were Kretovich’s annual sales?
A company's sales in 2020 were $3.7 million and its total spontaneous assets were $9.7 million. Also in the same year, the firm's spontaneous liabilities consisted of $6.7 million in wages payable, $7.1 million in accounts payable, and $5.9 million in accrued expenses. The firm's profit margin is 5.5% and its dividend payout ratio is 3.1%. The balance sheet at year-end is similar in percentage of sales to that of previous years and this will continue in the future. Required: What is the percentage increase in sales that the company must achieve in order to avoid raising funds externally? Note: The term "k" is used to represent thousands (x $1,000). % (ROUND YOUR ANSWER TO 2 DECIMAL PLACES. FOR EXAMPLE: 17.23)
In 2016, the Allen corporation had sales of $63 million, total assets of $44 million, and total liabilities of $15 million. The interest rate on the company’s debt is 5.7 percent, and it’s tax rate is 35 percent. The operating profit margin is 14 percent. Calculate the firm’s operating return on assets
In 2016, the Allen corporation had sales of $63 million, total assets of $44 million, and total liabilities of $15 million. The interest rate on the company’s debt is 5.7 percent, and it’s tax rate is 35 percent. The operating profit margin is 14 percent. B. Calculate the firm’s operating return on assets and return on equity. Operating return on assets is 20.05% Round to two decimal places. The return on equity is Round to two decimal places.
In 2016, the Allen Corporation had sales of $61 million, total assets of $43 million, and total liabilities of $15 million. The interest rate on the company's debt is 5.8 percent, and its tax rate is 35 percent. The operating profit margin is 14 percent. a. Compute the firm's 2016 net operating income and net income. b. Calculate the firm's operating return on assets and return on equity. (Hint: You can assume that interest must be paid on all of the firm's liabilities.)
In 2016, the Allen corporation had sales of $67 million, total assets of $42 million, and total liabilities of $19 million. The interest rate on the company’s debt is 6.3 percent, and it’s tax rate is 35 percent. The operating profit margin is 14 percent A. Compute the firm’s 2016 net operating income and net income The firm’s 2016 net operating income is Round to two decimal places B. Calculate the firms operating return on assets and return on equity.
In 2016, the Allen Corporation had sales of $62 million, total assets of $47 million, and total liabilities of $19 million. The interest rate on the company's debt is 5.9 percent, and its tax rate is 35 percent. The operating profit margin is 14 percent. a) Compute the firm's 2016 net operating income and net income. b) Calculate the firm's operating return on assets and return on equity.
In 2016, the Allen Corporation had sales of $60 million, total assets of $47 million, and total liabilities of $22 million. The interest rate on the company's debt is 5.6%, and its tax rate is 35%. The operating profit margin is 12%. Compute the firm's 2016 net operating income and net income. Calculate the firm's operating return on assets and return on equity. (Hint: You can assume that interest must be paid on all of the firm's liabilities.)
In 2016, the Allen corporation had sales of $63 million, total assets of $44 million, and total liabilities of $15 million. The interest rate on the company’s debt is 5.7 percent, and it’s tax rate is 35 percent. The operating profit margin is 14 percent. A. Compute the firm’s 2016 net operating income and net income The firm’s 2016 net operating income is Round to two decimal places.
The 2021 and 2020 balance sheets for Sunset Industries are provided below. The company’s sales for 2021 were $1,320 million, and EBITDA was 15% of sales. Furthermore, depreciation amounted to 10% of net fixed assets, interest expense was $30 million, the corporate tax rate was 25%, and Sunset pays out 40% of its net income as dividends. Sunset had 25 million shares outstanding in 2021, the 12/31/21 stock price was $80 per share, and its after-tax cost of capital was 15%. Based upon this information, answer the following questions. Sunset Industries December 31 Balance Sheets (in thousands of dollars) 2021 2020 Assets Cash and cash equivalents $55,908 $44,000 Excess cash $5,992 $6,793 Accounts receivable $112,044 $92,370 Inventories $176,251 $157,488 Total current assets $350,195 $300,651 Net fixed assets $408,000 $324,000 Total assets $758,195 $624,651 Liabilities and equity Accounts payable $42,018 $30,420 Accruals $24,187 $18,981 Notes payable $38,500 $40,000 Total current…
The Malia Corporation had sales in 2015 of $65 million, total assets of $42 million, and total liabilities of $20 million. The interest rate on the company's debt is 6 percent, and its tax rate is 30 percent. The operating profit margin was 12 percent. What were the company's operating profits and net income? What was the operating return on assets and return on equity? Assume that interest must be paid on all of the debt.
During the current year, Kite Corporation had average total assets are $500,000, total asset turnover of 1.10, and a net profit margin percentage of 12.0%. Kite's interest expense equals 5.0% of its total liabilities and its income tax rate is 21.0%. For purposes of computing its operating income (or EBIT), Kite's contribution margin ratio is 25%. If Kite's return on equity is 26.4%, what is Kite's equity multiplier? Round to two decimal points. O 0.50 O 0.67 O 1.50 2.00 None of the above