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Urban's, which is currently operating at full capacity, has sales of $ 4 7 , 0 0 0 , current assets of $ 5 ,

Urban's, which is currently operating at full capacity, has sales of $47,000, current assets of
$5,100, current liabilities of $6,200, net fixed assets of $51,500, and a profit margin of 5 percent. The
firm has no long-term debt and does not plan on acquiring any. The firm does not pay any
dividends. Sales are expected to increase by 3 percent next year. If all assets, short-term liabilities,
and costs vary directly with sales, how much additional equity financing is required for next year?
A)$908.50
B)$722.50
C) $967.30
D) $1,698.00
E) $1,512.00
28) Muder's Market has sales of $28,400, net income of $2,250, and a retention ratio of 60 percent.
Assume the profit margin and the payout ratio are constant and sales increase by 6 percent. What is
the pro forma retained earnings if the current retained earnings balance is $4,100?
A) $5,450
B) $5,721
C) $5,531
D) $5,648
E) $5,028

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