Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Galehouse Gas Stations Inc. expects sales to Increase from $1,690,000 to $1,890,000 next year. Galehouse believes that net assets (Assets - Liabilities) will represent

image text in transcribed

Galehouse Gas Stations Inc. expects sales to Increase from $1,690,000 to $1,890,000 next year. Galehouse believes that net assets (Assets - Liabilities) will represent 65 percent of sales. His firm has an 11 percent return on sales and pays 35 percent of profits out as dividends. a. What effect will this growth have on funds? The cash balance will Increase by b. if the dividend payout is only 15 percent, what effect will this growth have on funds? The cash balance wil increase by 46.715

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

International Financial Reporting and Analysis

Authors: David Alexander, Anne Britton, Ann Jorissen

5th edition

978-1408032282, 1408032287, 978-1408075012

More Books

Students also viewed these Accounting questions

Question

1 0 9 8 .

Answered: 1 week ago