Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Use percentage of sales approach and figure out, approximately, how much external financing needed (or free cash flow generated) if Lis corporation projects to grow

image text in transcribed
image text in transcribed
Use percentage of sales approach and figure out, approximately, how much external financing needed (or free cash flow generated) if Lis corporation projects to grow its sale by 20%.
Calculate sustainable growth rate and internal growth rate for Lis firm based on 2018 reports.
100 300 Li's Corporation 2018 Balance Sheet (in thousands) Assets Liability and Equity Current Assets Current Libility Cash 300 Account Payable Account Receivable 200 Notes Payable Inventory 400 Total Current Asset 900 Total Current Libility Equipment, Machine, and Plant 1500 Long Term Liability Total Finxed Assets 1500 Total Long Term Liability Shareholder's Equity Retained Earnings Total Shareholder's Equity Total Asset 2400 Total Liability and Shareholder's Equity 400 800 800 600 600 1200 2400 Li's Corporation 2018 Income Statement Sales 1000 350 Costs of Goods Sold 500 Depreciation 150 EBIT Interetst Expense 100 Taxable Income Tax (34%) 85 Net Income Dividends Addition to Retained Earnings 250 165 65 100

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

Foundations Of Statistics For Data Scientists With R And Python

Authors: Alan Agresti

1st Edition

0367748452, 978-0367748456

More Books

Students also viewed these Finance questions

Question

2 What is the philosophy of performance management?

Answered: 1 week ago