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Galehouse Gas Stations Inc. expects sales to increase from $1,560,000 to $1,760,000 next year. Galehouse believes that net assets (Assets Liabilities) will represent 55 percent
Galehouse Gas Stations Inc. expects sales to increase from $1,560,000 to $1,760,000 next year. Galehouse believes that net assets (Assets Liabilities) will represent 55 percent of sales. His firm has an 7 percent return on sales and pays 35 percent of profits out as dividends. a. What effect will this growth have on funds?
b. If the dividend payout is only 10 percent, what effect will this growth have on funds?
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