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help ASAP PLS!!! 4. More on the AFN (Additional Funds Needed) equation Bohemian Manufacturing Company reported sales of $720,000 at the end of last year,
help ASAP PLS!!!
4. More on the AFN (Additional Funds Needed) equation Bohemian Manufacturing Company reported sales of $720,000 at the end of last year, but this year, sales are expected to grow by 9%. BMC expects to maintain its current profit margin of 24% and dividend payout ratio of 25%. The following information was taken from BMC's balance sheet: Total assets: $475,000 Accounts payable: Notes payable: $75,000 $25,000 Accrued liabilities: $80,000 Based on the AFN equation, the firm's AFN for the current year is -$129,334 A negatively-signed AFN value represents -$106,841 O a shortage of internally generated funds that must be rai he company to finance the company's forecasted future growth. -$112,464 O a point at which the funds generated within the firm equ ds for funds to finance the firm's future expected sales requirements. -$134,957 O 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, BMC is thinking about raising its dividend payout ratio to satisfy shareholders. What percentage of its earnings can BMC pay to shareholders without needing to raise any external capital? (Hint: What can BMC increase its dividend payout ratio to before the AFN becomes positive?) O 84.7 O 76.2 O 80.5 0 67.8 A negatively-signed AFN value represents a shortage of internally generated funds that must be raised outside the company to finance the company's forecasted future growth. a point at which the funds generated within the firm equal the demands for funds to finance the firm's future expected sales requirements. a surplus of internally generated funds that can be invested in physical or financial assets or paid out as additional dividendsStep by Step Solution
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