Q1

Q2

The most recent financial statements for Assouad, Incorporated, are shown here: $ 840 Income Statement Sales $ 4,200 Costs 2,400 Taxable income $ 1,800 Taxes (22%) 396 Net income $ 1,404 Balance Sheet Current Current assets $3,900 liabilities Fixed assets 4,900 Long-term debt Equity Total $ 8,800 Total 3,560 4,400 $ 8,800 Assets, costs, and current liabilities are proportional to sales. Long-term debt and equity are not. The company maintains a constant 50 percent dividend payout ratio. As with every other firm in its industry, next year's sales are projected to increase by exactly 25 percent. What is the external financing needed? Assume the following ratios are constant. Total asset turnover Profit margin Equity multiplier Payout ratio 1.49 6.5% 1.3 59% What is the sustainable growth rate