Problem 4-27 (Algo) Percent-of-sales method [LO4-3]Owen's Electronics has nine operating plants in seven southwestern states. Sales for last year were $100 million, and the balancesheet at year-end is similar in percentage of sales to that of previous years (and this will continue in the future). All assets (includingfixed assets) and current liabilities will vary directly with sales. The firm is working at full capacity.CashAccounts receivableInventoryCurrent assets.Fixed assetsTotal assetsAssetsNew fundsat I can't message you ahead of time because of1Balance Sheet (in $ millions)2$ 112829$ 6846OCT$ 114Liabilities and Stockholders' EquityAccounts payableAccrued wagesAccrued taxesOwen's Electronics has an aftertax profit margin of 10 percent and a dividend payout ratio of 50 percent.If sales grow by 30 percent next year, determine how many dollars of new funds are needed to finance the growth.Note: Do not round intermediate calculations. Enter your answer in dollars, not millions, (e.g., $1,234,567).Current liabilitiesNotes payableCommon stockRetained earningsTotal liabilities and stockholders' equity< Prev 58 of 742Next >$ 231013ATTRACT.$ 46182030$ 114

STEP 1By taking into account the expenses associated with creating and selling products, profit…

Owen's Electronics has nine operating plants in seven southwestern states. Sales for last year were $100 million, and the balance sheet at year-end is similar in percentage of sales to that of previous years (and this will continue in the future). All assets (including fixed assets) and current liabilities will vary directly with sales. The firm is working at full capacity. Cash Accounts receivable Inventory Current assets Fixed assets Assets Total assets Balance Sheet (in $ millions) Liabilities and Stockholders' Equity $ 11 Accounts payable 28 Accrued wages 29 Accrued taxes $68 46 $ 114 Current liabilities Notes payable Common stock Retained earnings Total liabilities and stockholders' equity Owen's Electronics has an aftertax profit margin of 10 percent and a dividend payout ratio of 50 percent. $ 23 10 13. $ 46 18 20 30 $ 114

Owen's Electronics has nine operating plants in seven southwestern states. Sales for last year were $100 million, and the balance sheet at year-end is similar in percentage of sales to that of previous years (and this will continue in the future). All assets (including fixed assets) and current liabilities will vary directly with sales. The firm is working at full capacity. Cash Accounts receivable Inventory Current assets Fixed assets Assets Total assets Balance Sheet (in $ millions) Liabilities and Stockholders' Equity $ 11 Accounts payable 28 Accrued wages 29 Accrued taxes $68 46 $ 114 Current liabilities Notes payable Common stock Retained earnings Total liabilities and stockholders' equity Owen's Electronics has an aftertax profit margin of 10 percent and a dividend payout ratio of 50 percent. $ 23 10 13. $ 46 18 20 30 $ 114

EBK CONTEMPORARY FINANCIAL MANAGEMENT

14th Edition

ISBN:9781337514835

Author:MOYER

Publisher:MOYER

Chapter4: Financial Planning And Forecasting

Section: Chapter Questions

Problem 10P

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Problem 4-27 (Algo) Percent-of-sales method [LO4-3] Owen's Electronics has nine operating plants in seven southwestern states. Sales for last year were $100 million, and the balance sheet at year-end is similar in percentage of sales to that of previous years (and this will continue in the future). All assets (including fixed assets) and current liabilities will vary directly with sales. The firm is working at full capacity. Cash Accounts receivable Inventory Current assets Fixed assets Assets Total assets New funds $ Balance Sheet (in $ millions) 18 $10 22 27 $59 47 Liabilities and Stockholders' Equity Accounts payable Accrued wages Accrued taxes Current liabilities $106 Owen's Electronics has an aftertax profit margin of 8 percent and a dividend payout ratio of 50 percent. If sales grow by 25 percent next year, determine how many dollars of new funds are needed to finance the growth. Note: Do not round intermediate calculations. Enter your answer in dollars, not millions, (e.g.,…
Problem 4-27 (Algo) Percent-of-sales method [LO4-3] Owen's Electronics has nine operating plants in seven southwestern states. Sales for last year were $100 million, and the balance sheet at year-end is similar in percentage of sales to that of previous years (and this will continue in the future). All assets (including fixed assets) and current liabilities will vary directly with sales. The firm is working at full capacity. Cash Accounts receivable. Inventory Current assets Assets Fixed assets Balance Sheet (in 5 millions). Liabilities and Stockholders' Equity $5 Accounts payablet 23 26 $ 54 43 Accrued wages Accrued taxes. Current liabilities Notes payable Common stock Retained earnings. $97 Total liabilities and stockholders equity Answer is complete but not entirely correct. New funds 21 $18 5 11 $34 13 18 32 $ 97 Total assets Owen's Electronics has an aftertax profit margin of 8 percent and a dividend payout ratio of 30 percent. If sales grow by 15 percent next year, determine how…
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