Question

Revenues $4,200     Current assets $4,500     Current liabilities $970     Costs 2,800     Fixed assets 5,300     Long-term debt 3,500  ...

Revenues $4,200     Current assets $4,500     Current liabilities $970  
  Costs

2,800  

   Fixed assets 5,300     Long-term debt 3,500  
  Taxable income $1,400     Equity 5,330  
  Taxes (23%) 322       Total

$9,800  

     Total

$9,800  
    Net income

$1,078  

Assets, costs, and current liabilities vary directly with revenues. Long-term debt and equity do not. The firm maintains a constant 40 percent dividend payout rate. Revenues for the next year are projected to increase by 25 percent.

What is the external financing needed for the next year?

Multiple Choice

  • $1,399.00

  • $1,349.00

  • $875.00

  • $1,641.50

  • $1,449.00

Business   Accounting   
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Answer #1

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$ 1399.00

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