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The profit margin, the debt-equity ratio, and the dividend payout ratio for this firm are constant. Sales are expected to increase by $6,500 next year.
The profit margin, the debt-equity ratio, and the dividend payout ratio for this firm are constant. Sales are expected to increase by $6,500 next year. What is the projected addition to retained earnings for next year? OA) $1,885 OB) $4,119 OC) $3,994 OD) $3,575 OE) $2,386 Income Statement For the Year Sales Cost of goods sold Depreciation Earnings before interest and taxes Interest paid Taxable income Taxes $42,700 29,250 3,750 $ 9,700 1,360 $ 8,340 2,840 $ 5,500 Net income Dividends $1,925 Balance Sheet End-of-Year Cash Accounts receivable Inventory Total current assets Net fixed assets Total assets $ 1,320 3,780 10,200 $15,300 33,600 $48,900 Accounts payable Long-term debt Common stock ($1 par value) Retained earnings Total Liab. & Equity $ 3,650 18,100 15,000 12,150 $48,900
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