Homework Answers
Bank Loans, Investment from Private Individuals/Investment Firms, Grant/Selling Company's Shares, Issue of Debentures are some of options available external financing to support given requirements.
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External Financing Needed (EFN) If we need external financing to support and increase in sales, what...
1. Which of the following items are determinants of external financing needed (EFN) when the percentage...
1. Which of the following items are determinants of external financing needed (EFN) when the percentage of sale approach is applied normally based on a sustainable growth rate? I. increase in total assets II. new borrowing III. taxes payable IV. addition to retained earnings Select one: a. I only b. I and II only c. I, II, and III only d. I, II, and IV only e. I, II, III, and IV 2. Given the following information, what is the...
1. Compute the external financing needed to support the projected annual sales growth. The most recent...
1. Compute the external financing needed to support the
projected annual sales growth.
The most recent financial statements for Fleury, Inc., follow.
Sales for 2012 are projected to grow by 20%. Interest expense will
remain constant. The tax rate and the dividend payout rate will
remain constant. Costs, other expenses, current assets, fixed
assets, and accounts payable increase spontaneously with sales. If
the firm is operating at full capacity and no new debt or equity is
issued, what external financing...
What is the external financing needed ?
The most recent financial statements for Cooper, Inc., are shown here (assuming no income taxes) ; Sales $5,700 ,costs 3,820 ,Net income $1,880 ,Assets $14.100 , Total $14.100 , Debt $ 6,300 , Equity 7,800 , Total $14.100Assets and costs are proportional to sales. Debt and equity are not. No dividends are paid. Next year's sales are projected to be $6,669. What is the external financing needed?
The portion of the necessary increase in assets to support an increase in sales that will...
The portion of the necessary increase in assets to support an increase in sales that will need to be funded from external capital is called A. capital deficit. B. excess funding requirement. C. funds from operations. D. additional funds needed.
External Funds Needed The Optical Scan Company has forecast a 20 percent sales growth rate for...
External Funds Needed The Optical Scan Company has forecast a 20 percent sales growth rate for next year. The current financial statements are shown here: 3.8 Statement of Comprehensive Income Sales Costs Taxable income Taxes Net income $30,400,000 26,720,000 $ 3,680,000 1,288,000 $ 2,392,000 Dividends Addition to retained earnings $ 956,800 1,435,200 Statement of Financial Position Assets Liabilities and shareholder's equity Current assets 7,200,000 Short-term debt Fixed assets 17,600,000 Long-term debt Common stock $6,400,000 4,800,000 $3,200,000 10,400,000 $13,600,000 $24.800,000 Accumulated...
Problem 4-3 Calculating EFN [LO2] The most recent financial statements for Hornick, Inc., are shown here...
Problem 4-3 Calculating EFN [LO2] The most recent financial statements for Hornick, Inc., are shown here (assuming no income taxes): Income Statement Sales Costs Balance Sheet 6,150 quity 13,200 S 6,800 Assets $19,350 Debt 4,750 Net income S 2,050 Tot$19,350 Total $19,350 sales are projected to be $8,024. What is the external financing needed? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) External financing needed
Problem 4-3 Calculating EFN (LO2] The most recent financial statements for Kerch, Inc. are shown here...
Problem 4-3 Calculating EFN (LO2] The most recent financial statements for Kerch, Inc. are shown here (assuming no income taxes): Income Statement Sales $ 7.600 Costs 5,020 Assets Balance Sheet $19,100 Debt Equity $7,000 12.100 Net income $2,580 Total $19,100 Total $19,100 Assets and costs are proportional to sales, Debt and equity are not. No dividends are paid. Next year's sales are projected to be $9,500. What is the external financing needed? (Do not round intermediate calculations and round your...
Problem 4-5 EFN (LO2] The most recent financial statements for Assouad, Inc., are shown here: Income...
Problem 4-5 EFN (LO2] The most recent financial statements for Assouad, Inc., are shown here: Income Statement Sales $10,500 Balance Sheet Current assets $ 4.950 Current liabilities Fixed assets 9,900 Long-term debt $ 3,075 Costs 7.450 4.610 Taxable income $ 3,050 Equity 7,165 Taxes (22%) 671 Total $14,850 Total $14,850 Net income $ 2,379 Assets, costs, and current liabilities are proportional to sales. Long-term debt and equity are not. The company maintains a constant 45 percent dividend payout ratio. As...
Problem 3-21 Calculating EFN The most recent financial statements for Moose Tours, Inc., appear below. Sales...
Problem 3-21 Calculating EFN The most recent financial statements for Moose Tours, Inc., appear below. Sales for 2012 are projected to grow by 30 percent. Interest expense will remain constant; the tax rate and the dividend payout rate will also remain constant. Costs, other expenses, current assets, fixed assets, and accounts payable increase spontaneously with sales. MOOSE TOURS, INC. 2011 Income Statement Sales Costs Other expenses $ 748.000 583.000 19.000 Earnings before interest and taxes Interest expense $ 146.000 10,000...
Let's change capacity to 90 percent and recalculate external financing needed. We have Cromwell's financial statements...
Let's change capacity to 90 percent and recalculate external financing needed. We have Cromwell's financial statements from this year. Income Statement Sales 1,000,000 (250,000) (180,000) 570,000 (130,000) 440,000 (132,000) 308,000 Costs Depreciation EBIT Interest expense EBT Taxes (.3) Net Income Dividends 231,000 Additions to Retained Earnings 77,000 Balance Sheet Cash 70,000 Accounts pay 60,000 Accounts rec 30,000 Notes payable 25,000 Inventory 80,000 Current Liab 85,000 Current Assets 180,000 Long-term debt 250,000 Fixed Assets 750,000 Owners' Equity Common stock 90,000 505,000...
1. Compute the external financing needed to support the
projected annual sales growth.
The most recent financial statements for Fleury, Inc., follow.
Sales for 2012 are projected to grow by 20%. Interest expense will
remain constant. The tax rate and the dividend payout rate will
remain constant. Costs, other expenses, current assets, fixed
assets, and accounts payable increase spontaneously with sales. If
the firm is operating at full capacity and no new debt or equity is
issued, what external financing...
External Funds Needed The Optical Scan Company has forecast a 20 percent sales growth rate for next year. The current financial statements are shown here: 3.8 Statement of Comprehensive Income Sales Costs Taxable income Taxes Net income $30,400,000 26,720,000 $ 3,680,000 1,288,000 $ 2,392,000 Dividends Addition to retained earnings $ 956,800 1,435,200 Statement of Financial Position Assets Liabilities and shareholder's equity Current assets 7,200,000 Short-term debt Fixed assets 17,600,000 Long-term debt Common stock $6,400,000 4,800,000 $3,200,000 10,400,000 $13,600,000 $24.800,000 Accumulated...
Problem 4-3 Calculating EFN [LO2] The most recent financial statements for Hornick, Inc., are shown here (assuming no income taxes): Income Statement Sales Costs Balance Sheet 6,150 quity 13,200 S 6,800 Assets $19,350 Debt 4,750 Net income S 2,050 Tot$19,350 Total $19,350 sales are projected to be $8,024. What is the external financing needed? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) External financing needed
Problem 4-3 Calculating EFN (LO2] The most recent financial statements for Kerch, Inc. are shown here (assuming no income taxes): Income Statement Sales $ 7.600 Costs 5,020 Assets Balance Sheet $19,100 Debt Equity $7,000 12.100 Net income $2,580 Total $19,100 Total $19,100 Assets and costs are proportional to sales, Debt and equity are not. No dividends are paid. Next year's sales are projected to be $9,500. What is the external financing needed? (Do not round intermediate calculations and round your...
Problem 4-5 EFN (LO2] The most recent financial statements for Assouad, Inc., are shown here: Income Statement Sales $10,500 Balance Sheet Current assets $ 4.950 Current liabilities Fixed assets 9,900 Long-term debt $ 3,075 Costs 7.450 4.610 Taxable income $ 3,050 Equity 7,165 Taxes (22%) 671 Total $14,850 Total $14,850 Net income $ 2,379 Assets, costs, and current liabilities are proportional to sales. Long-term debt and equity are not. The company maintains a constant 45 percent dividend payout ratio. As...
Problem 3-21 Calculating EFN The most recent financial statements for Moose Tours, Inc., appear below. Sales for 2012 are projected to grow by 30 percent. Interest expense will remain constant; the tax rate and the dividend payout rate will also remain constant. Costs, other expenses, current assets, fixed assets, and accounts payable increase spontaneously with sales. MOOSE TOURS, INC. 2011 Income Statement Sales Costs Other expenses $ 748.000 583.000 19.000 Earnings before interest and taxes Interest expense $ 146.000 10,000...
Let's change capacity to 90 percent and recalculate external financing needed. We have Cromwell's financial statements from this year. Income Statement Sales 1,000,000 (250,000) (180,000) 570,000 (130,000) 440,000 (132,000) 308,000 Costs Depreciation EBIT Interest expense EBT Taxes (.3) Net Income Dividends 231,000 Additions to Retained Earnings 77,000 Balance Sheet Cash 70,000 Accounts pay 60,000 Accounts rec 30,000 Notes payable 25,000 Inventory 80,000 Current Liab 85,000 Current Assets 180,000 Long-term debt 250,000 Fixed Assets 750,000 Owners' Equity Common stock 90,000 505,000...
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