Blue Ek Manufacturing reported sales of $720,000 at the end of last year; but this year, sales are expected to grow by 8%. Blue Elk expects to maintain its current profit margin of 20% and dividend payout ratio of 25%. The firm's total assets equaled $400,000 and were operated at full capacity. Blue Elk's balance sheet shows the following current liabilities: accounts payable of $80,000, notes payable of $25,000, and accrued babilities of $60,000. Based on the AFN (Additional Funds Needed) equation, what is the firm's AFN for the coming year? -5100,632 -$86,256 $95,840 -$115.000 A positively signed AFN value represents O a point at which the funds generated within the firm equal the demands for funds to finance the firm's future expected sales requirements 60.64 ortage of internally generated funds that must be raised outside the company to finance the company's forecasted future th 36.6% 77.99 plus of internally generated funds that can be invested in physical or financial assets or paid out as additional dividends. Bec excess funds, Blue Ek Manufacturing is thinking about raising its dividend payout ratio to satisty shareholders. Blue Ek could pay of its earnings to shareholders without needing to raise any external capital. (Hint: What can Blue Ek Increase its dividend payout ratio to before the AFN becomes positive?) out. Blue Ek Manufacturing reported sales of $220,000 at the end of last year, but this year sales are expected to grow by 8%. Blue Elk expects to maintain its current profit margin of 20% and dividend payout ratio of 25%. The firm's total assets equaled $400,000 and were operated at full capacity. Blue Ek's balance sheet shows the following current abilities: accounts payable of $80,000, notes payable of $25,000, and accrued tabilities of $60,000. Based on the AFN (Additional Funds Needed) equation, what is the firm's AFN for the coming year? -5100,632 $36,256 -$95.040 O $115,000 A positively signed AFN value represents a pont at which the funds generated within the firm equal the demands for funds to finance the firm's future expected sales requirements, a shortage of internally generated funds that must be raised outside the company to finance the company's forecasted future growth a surplus of internally generated funds that can be invested in physical or financial assets or paid out as additional dividends. Because of its excess funds, Blue Elk Manufacturing is thinking about raising its dividend payout ratio to satisfy shareholders. Blue Elk could pay of its earnings to shareholders without needing to raise any external capital. (Hint: What can Blue Elk increase its dividend payout ratio to before the A'N becomes positive?) out
