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In: Finance

the balance sheet for the serden company is shown below for sales of $300000. using the...

the balance sheet for the serden company is shown below for sales of $300000. using the percentage of sales method, assuming no long-term debt is paid off how much outside financing is required？(assume net profit to sales is 6 percent, payout ratio is 60 percent of net income, and sales increase 40 percent during 2019).

serden company balance sheet as of Dec. 31, 2018

cash    $15,000

accounts receivable    $60,000

inventory $90,000

current assets $165,000

fixed assets $30,000

total assets    $195,000

------------------

accounts payable $30,000

accruals    15,000

notes payable    0

total current liabilities 45,000

long-term debt    90,000

total debt    135,000

capital stock 60,000

retained earnings    0

total debt and net worth 195,000

-------

a. 61,500

b. 49,920

c. 60,800

d. 72,000

e. 36,900

Solutions

Expert Solution

EFN = b : 49920

jeff jeffy answered 7 months ago
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