Suppose that Gyp Sum Industries currently has the balance sheet shown below, and that sales for the year just ended were $10.9 million. The firm also has a profit margin of 25 percent and a retention ratio of 30 percent, and expects sales of $8.9 million next year. Assets Current assets Fixed assets Total assets $ 2,621,000 4,900,000 $ 7,521,000 Liabilities and Equity Current liabilities Long-term debt Equity Total liabilities and equity Additional funds needed S If all assets and current liabilities are expected to shrink with sales, what amount of additional funds will Gyp Sum need from external sources to fund the expected growth? Note: Enter your answer in dollars not in millions. Negative amount should be indicated by a minus sign. Answer is complete but not entirely correct. (243,300) $ 2,557,140 1,950,000 3,013,860 $ 7,521,000
Suppose that Gyp Sum Industries currently has the balance sheet shown below, and that sales for the year just ended were $10.9 million. The firm also has a profit margin of 25 percent and a retention ratio of 30 percent, and expects sales of $8.9 million next year. Assets Current assets Fixed assets Total assets $ 2,621,000 4,900,000 $ 7,521,000 Liabilities and Equity Current liabilities Long-term debt Equity Total liabilities and equity Additional funds needed S If all assets and current liabilities are expected to shrink with sales, what amount of additional funds will Gyp Sum need from external sources to fund the expected growth? Note: Enter your answer in dollars not in millions. Negative amount should be indicated by a minus sign. Answer is complete but not entirely correct. (243,300) $ 2,557,140 1,950,000 3,013,860 $ 7,521,000
Chapter4: Financial Planning And Forecasting
Section: Chapter Questions
Problem 10P
Related questions
Question
100%
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
This is a popular solution!
Trending now
This is a popular solution!
Step by step
Solved in 3 steps with 1 images
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, finance and related others by exploring similar questions and additional content below.Recommended textbooks for you
EBK CONTEMPORARY FINANCIAL MANAGEMENT
Finance
ISBN:
9781337514835
Author:
MOYER
Publisher:
CENGAGE LEARNING - CONSIGNMENT
Intermediate Financial Management (MindTap Course…
Finance
ISBN:
9781337395083
Author:
Eugene F. Brigham, Phillip R. Daves
Publisher:
Cengage Learning
EBK CONTEMPORARY FINANCIAL MANAGEMENT
Finance
ISBN:
9781337514835
Author:
MOYER
Publisher:
CENGAGE LEARNING - CONSIGNMENT
Intermediate Financial Management (MindTap Course…
Finance
ISBN:
9781337395083
Author:
Eugene F. Brigham, Phillip R. Daves
Publisher:
Cengage Learning