Dividends per share = $ II. Because of an agreement with their lender, Garlington's current ratio cannot drop below 1.7x or it will violate a debt covenant. How much can the company increase its notes payable and still not violate its minimum current ratio? Increase in notes payable = $ ROE = III. Assume that Garlington increases its notes payable to the maximum allowed under its current ratio restriction and issues stock (at the beginning of the year) to raise the remaining funds required. Calculate the company's ROE, EPS, and DPS. EPS = $ DPS = $ ROE = EPS = $ IV. Recalculate Garlington's ROE, EPS, and DPS if all the additional financing was obtained through the sale of new common stock. DPS tA 5.4 % $ 1.04 % 65,294 10

II. Because of an agreement with their lender, Garlington's current ratio cannot drop below 1.7 x or it will violate a debt covenant. How much can the company increase its notes payable and still not violate its minimum current ratio? Increase in notes payable =$ III. Assume that Garlington increases its notes payable to the maximum allowed under its current ratio restriction and issues stock (at the beginning of the year) to raise the remaining funds required. Calculate the company's ROE, EPS, and DPS. ROE= % EPS=$ DPS =$ IV, Recalculate Garlington's ROE, EPS, and DPS if all the additional financing was obtained through the sale of new common stock. ROE = % EPS=$ II. Because of an agreement with their lender, Garlington's current ratio cannot drop below 1.7 or it will violate a debt covenant. How much can the company increase its notes payable and still not violate its minimum current ratio? Increase in notes payable =$ III. Assume that Garlington increases its notes payable to the maximum allowed under its current ratio restriction and issues stock (at the beginning of the year) to raise the remaining funds required. Calculate the company's ROE, EPS, and DPS. EPS=$DPS=$ IV. Recalculate Garlington's ROE, EPS, and DPS if all the additional financing was obtained through the sale of new common stock. EPS=5 DPS =5