The most recent financial statements for GPS, Inc., are shown here: Income Statement Sales $21706 Costs...

The most recent financial statements for GPS, Inc., are shown here:

Income Statement
Sales	$21706
Costs	$14096
Taxable Income	?
Taxes (40%)	?
Net Income	?

Balance Sheet
Assets	$55199	Debt	$22015
		Equity	?

Assets and costs are proportional to sales. Debt and equity are not. A dividend of $1887 was paid, and the company wishes to maintain a constant payout ratio. Next year’s sales are projected to be $29409.

What is the external financing needed? (round 2 decimal places)

Solutions

Expert Solution

Income Statement	Recent	Projected
Sales	21706	29409.00
Costs	14096	19098.37
Taxable Income	7610	10310.63
Taxes 40%	3044	4124.25
Net Income	4566	6186.38
Less: Dividend	1887	2556.66
Retained earnings	2679	3629.72

EFN = (Projected assets - old assets) - Retained earnings

= (55199*29409/21706-55199) - 3629.72

=$15959.24

WORKINGS

jeff jeffy answered 1 year ago

Next > < Previous

Related Solutions

The most recent financial statements for GPS, Inc., are shown here: Income Statement Sales $23,852 Costs...

The most recent financial statements for GPS, Inc., are shown here: Income Statement Sales $23,852 Costs $11,902 Taxable Income ? Taxes (40%) ? Net Income ? Balance Sheet Assets $56,455 Debt $18,576 Equity ? Assets and costs are proportional to sales. Debt and equity are not. A dividend of $1,980 was paid, and the company wishes to maintain a constant payout ratio. Next year’s sales are projected to be $29,412. What is the external financing needed? (Negative amount should be...

The most recent financial statements for GPS, Inc., are shown here: Income Statement Sales $23,120 Costs...

The most recent financial statements for GPS, Inc., are shown here: Income Statement Sales $23,120 Costs $11,132 Taxable Income ? Taxes (40%) ? Net Income ? Balance Sheet Assets $56,917 Debt $21,193 Equity ? Assets and costs are proportional to sales. Debt and equity are not. A dividend of $1,748 was paid, and the company wishes to maintain a constant payout ratio. Next year’s sales are projected to be $27,881. What is the external financing needed? (Negative amount should be...

The most recent financial statements for GPS, Inc., are shown here: Income Statement Balance Sheet Sales...

The most recent financial statements for GPS, Inc., are shown here: Income Statement Balance Sheet Sales $23,800 Assets $121,000 Debt $43,600 Costs 16,900 Equity 77,400 Taxable income $6,900 Total $121,000 Total $121,000 Taxes (30%) 2,070 Net income $4,830 Assets and costs are proportional to sales. Debt and equity are not. A dividend of $1,470 was paid, and the company wishes to maintain a constant payout ratio. Next year's sales are projected to be $29,400. Required: What is the external financing...

The most recent financial statements for GPS, Inc., are shown here: Income Statement Balance Sheet Sales...

The most recent financial statements for GPS, Inc., are shown here: Income Statement Balance Sheet Sales $22,900 Assets $113,000 Debt $31,600 Costs 16,600 Equity 81,400 Taxable income $6,300 Total $113,000 Total $113,000 Taxes (30%) 1,890 Net income $4,410 Assets and costs are proportional to sales. Debt and equity are not. A dividend of $1,500 was paid, and the company wishes to maintain a constant payout ratio. Next year's sales are projected to be $29,200. Required: What is the external financing...

The most recent financial statements for GPS, Inc., are shown here: Income Statement Balance Sheet Sales...

The most recent financial statements for GPS, Inc., are shown here: Income Statement Balance Sheet Sales $22,300 Assets $105,000 Debt $33,600 Costs 16,000 Equity 71,400 Taxable income $6,300 Total $105,000 Total $105,000 Taxes (30%) 1,890 Net income $4,410 Assets and costs are proportional to sales. Debt and equity are not. A dividend of $1,610 was paid, and the company wishes to maintain a constant payout ratio. Next year's sales are projected to be $28,900. Required: What is the external financing...

The most recent financial statements for Xporter, Inc., are shown here: Income Statement Sales $6,813 Costs...

The most recent financial statements for Xporter, Inc., are shown here: Income Statement Sales $6,813 Costs $5,829 Taxable Income ? Taxes (34%) ? Net Income ? Balance Sheet Current Asset $3,578 Current Liabilities $2,047 Fixed Asset $9,726 Long Term Debt $3,565 Equity ? Assets, costs, and current liabilities are proportional to sales. Long-term debt and equity are not. The company maintains a constant 21 percent dividend payout ratio. As with every other firm in its industry, next year’s sales are...

The most recent financial statements for Xporter, Inc., are shown here: Income Statement Sales $7062 Costs...

The most recent financial statements for Xporter, Inc., are shown here: Income Statement Sales $7062 Costs $5789 Taxable Income ? Taxes (34%) ? Net Income ? Balance Sheet Current Asset $3750 Current Liabilities $2453 Fixed Asset $9635 Long Term Debt $3626 Equity ? Assets, costs, and current liabilities are proportional to sales. Long-term debt and equity are not. The company maintains a constant 16 percent dividend payout ratio. As with every other firm in its industry, next year’s sales are...

P4-4 EFN [LO2] The most recent financial statements for GPS, Inc., are shown here: Income Statement...

P4-4 EFN [LO2] The most recent financial statements for GPS, Inc., are shown here: Income Statement Balance Sheet Sales $23,800 Assets $114,000 Debt $33,600 Costs 16,600 Equity 80,400 Taxable income $7,200 Total $114,000 Total $114,000 Taxes (30%) 2,160 Net income $5,040 Assets and costs are proportional to sales. Debt and equity are not. A dividend of $1,560 was paid, and the company wishes to maintain a constant payout ratio. Next year's sales are projected to be $28,000. Required: What is...

The most recent financial statements for Live Co. are shown here: Income Statement Sales $18801 Costs...

The most recent financial statements for Live Co. are shown here: Income Statement Sales $18801 Costs $10361 Taxable Income ? Taxes (40%) ? Net Income ? Balance Sheet Current Asset $13198 Debt $18918 Fixed Asset $31869 Equity ? Assets and costs are proportional to sales. Debt and equity are not. The company maintains a constant 28 percent dividend payout ratio. No external financing is possible. What is the internal growth rate (in %)?

The most recent financial statements for Live Co. are shown here: Income Statement Sales $15752 Costs...

The most recent financial statements for Live Co. are shown here: Income Statement Sales $15752 Costs $11206 Taxable Income ? Taxes (40%) ? Net Income ? Balance Sheet Current Asset $13516 Debt $16391 Fixed Asset $25944 Equity ? Assets and costs are proportional to sales. Debt and equity are not. The company maintains a constant 20 percent dividend payout ratio. No external financing is possible. What is the sustainable growth rate (in %)?

Subjects