Question
The most recent financial statements for Cardinal, Inc., are shown here: Income Statement Balance Sheet Sales $ 31,400 Assets $ 74,000 Debt $ 37,400 Costs
| The most recent financial statements for Cardinal, Inc., are shown here: |
| Income Statement | Balance Sheet | ||||||||||
| Sales | $ | 31,400 | Assets | $ | 74,000 | Debt | $ | 37,400 | |||
| Costs | 18,450 | Equity | 36,600 | ||||||||
| Taxable income | $ | 12,950 | Total | $ | 74,000 | Total | $ | 74,000 | |||
| Taxes (24%) | 3,108 | ||||||||||
| Net income | $ | 9,842 | |||||||||
| Assets and costs are proportional to sales. Debt and equity are not. A dividend of $3,800 was paid, and the company wishes to maintain a constant payout ratio. Next year’s sales are projected to be $36,424. |
| What is the external financing needed? |
Step by Step Solution
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Step: 1
To determine the external financing needed for Cardinal Inc we first need to calculate the projected ...
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Corporate Finance Core Principles and Applications
Authors: Stephen Ross, Randolph Westerfield, Jeffrey Jaffe, Bradford
3rd edition
978-0077971304, 77971302, 978-0073530680, 73530689, 978-0071221160, 71221166, 978-0077905200
