Question

# The most recent financial statements for Weyland Co. are shown here: INCOME STATEMENT BALANCE SHEET Sales...

The most recent financial statements for Weyland Co. are shown here:

 INCOME STATEMENT BALANCE SHEET Sales \$ 52,200 Current assets \$ 22,000 Long-term debt \$ 45,500 Costs 42,100 Fixed assets 91,000 Equity 67,500 Taxable income \$ 10,100 Total \$ 113,000 Total \$ 113,000 Taxes (34%) 3,434 Net income \$ 6,666

Assets and costs are proportional to sales. The company maintains a constant 20 percent dividend payout ratio and a constant debt−equity ratio.

What is the maximum increase in sales that can be sustained assuming no new equity is issued? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.)

Maximum increase in sales           \$

Calculate the maximum increase in sales as follows:

Therefore, the maximum increase in sales is \$4,477.80.

-----------------------------------------------------------------

Formulas:

#### Earn Coins

Coins can be redeemed for fabulous gifts.