In: Finance
The most recent financial statements for Throwing Copper Co. are shown here: |
Income Statement | Balance Sheet | ||||
Sales | $50,000 | Current assets | $78,300 | Long-term debt | $54,000 |
Costs |
32,000 |
Fixed assets | 43,200 | Equity | 67,500 |
Taxable income | $18,000 | Total |
$121,500 |
Total |
$121,500 |
Taxes (34%) | 6,120 | ||||
Net income |
$11,880 |
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Assets and costs are proportional to sales. The company maintains a constant 20 percent dividend payout ratio and a constant debt−equity ratio. |
Required: |
What is the maximum increase in sales that can be sustained assuming no new equity is issued? (Do not round your intermediate calculations.) |