Question
The Hudson River line company has a balance sheet of the year as follows: Cash $5,000 Ac Rec 20,000 Inventories 40,000 Total Current Assets $65,000Fixed
The Hudson River line company has a balance sheet of the year as follows: Cash $5,000 Ac Rec 20,000 Inventories 40,000 Total Current Assets $65,000Fixed assets 50,000 and total assets $115,000. Accounts pay $ 15,000 notes payable 10,000 long term debt30,000 Stockholders equity 60,000and total liabilities and equity$115,000. Last year the firm had sales of $148,750. This year the company expects sales to increase 25 percent to generate earnings after tax of $16,000 and pay a dividend of $5,000. What additional financing will be needed to support the sales increase?
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