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The most recent financial statements for Alexander Co. are shown here: Income Statement Balance Sheet Sales $ 52,400 Current assets $ 22,600 Long-term debt $
The most recent financial statements for Alexander Co. are shown here: |
Income Statement | Balance Sheet | ||||||||||
Sales | $ | 52,400 | Current assets | $ | 22,600 | Long-term debt | $ | 52,000 | |||
Costs | 42,200 | Fixed assets | 92,000 | Equity | 62,600 | ||||||
Taxable income | $ | 10,200 | Total | $ | 114,600 | Total | $ | 114,600 | |||
Taxes (34%) | 3,468 | ||||||||||
Net income | $ | 6,732 | |||||||||
Assets and costs are proportional to sales. The company maintains a constant 30 percent dividend payout ratio and a constant debtequity ratio. |
What is the maximum dollar increase in sales that can be sustained assuming no new equity is issued |
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