Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Trumpington Inc. is a furniture producer which is planning to increase its market share. The company is planning to grow its sales at 30% next

Trumpington Inc. is a furniture producer which is planning to increase its market share. The company is planning to grow its sales at 30% next year. The company is currently operating at full capacity. The company has a dividend pay-out ratio of 45%, which the management want to maintain in order to meet the shareholders expectations. Given the below information, determine the value of the External money needed for next year.Single line text.

Amounts in 000's sep-20
Sales 18240
Costs, Tax income 13440, 4800
taxes (34%) 1632
net income 3168
Amounts in 000's sep 20
cash 640 acounts payable 6400
accounts reciveables 5120 acrued expenese 640
inventory 6720 current liabilities 7040
current assests 12480 long term debt 12000
fixed assets 25920 equity 19360
total asstets 38400 total liab and equity 38400

22,

Referring to question (1), if we assume that the company decided not to raise any external fund and depend solely on its own internally generated funds, what would be the maximum growth rate that it can achieve?Single line text.

33,

Referring to Question (1), What is the company's sustainable growth rate?Single line text.

NOTE: Only need answer for 2nd and 3rd.

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

FINANCIAL ACCOUNTING AND COSTING

Authors: Meera Gopi Krishna

1st Edition

979-8604687369

More Books

Students also viewed these Accounting questions