Question
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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Essentials Of Investments
Authors: Zvi Bodie, Alex Kane, Alan Marcus
11th Edition
1260288390, 978-1260288391
