The most recent financial statements for Beckett Co. are shown here: Assets and costs are proportional to

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The most recent financial statements for Beckett Co. are shown here:

INCOME STATEMENT BALANCE SHEET Sales $74,300 Current assets $ 20,000 Long term debt $ 52,000 Costs 57,800 Fixed assets 146,000 Equity 114,000 Taxable income $16,500 Total $166,000 Total $166,000 Taxes (21%) 3,465 Net income $13,035

Assets and costs are proportional to sales. The company maintains a constant 30 percent dividend payout ratio and a constant debt-equity ratio. What is the maximum increase in sales that can be sustained assuming no new equity is issued?

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Corporate Finance Core Principles And Applications

ISBN: 9781260571127

6th Edition

Authors: Stephen Ross, Randolph Westerfield, Jeffrey Jaffe, Bradford Jordan

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