Question
A firm has the following details: ROE = 10% Expected ROE to remain the same Payout Ratio = 40% Equity/Assets = .43 Predicted sales growth
A firm has the following details:
- ROE = 10%
- Expected ROE to remain the same
- Payout Ratio = 40%
- Equity/Assets = .43
- Predicted sales growth of 10% for next year
- Total Liabilities = $2,000,000
- Assume assets need to grow at the same rate as sales
What are the company's (predicted) external financing needs for the next year? Assume the firm is following an internal growth approach.
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Auditing An International Approach
Authors: Wally J. Smieliauskas, Kathryn Bewley
6th edition
978-0070968295, 9781259087462, 978-0071051415
