Question

AFN Equation Broussard Skateboard's sales are expected to increase by 15% from $7.0 million in 2016...

AFN Equation

Broussard Skateboard's sales are expected to increase by 15% from $7.0 million in 2016 to $8.05 million in 2017. Its assets totaled $4 million at the end of 2016. Broussard is already at full capacity, so its assets must grow at the same rate as projected sales. At the end of 2016, current liabilities were $1.4 million, consisting of $450,000 of accounts payable, $500,000 of notes payable, and $450,000 of accruals. The after-tax profit margin is forecasted to be 4%. Assume that the company pays no dividends. Under these assumptions, what would be the additional funds needed for the coming year? Do not round intermediate calculations. Round your answer to the nearest dollar.
$

Why is this AFN different from the one when the company pays dividends?
I. Under this scenario the company would have a higher level of retained earnings which would reduce the amount of additional funds needed.
II. Under this scenario the company would have a higher level of retained earnings which would increase the amount of additional funds needed.
III. Under this scenario the company would have a higher level of retained earnings but this would have no effect on the amount of additional funds needed.
IV. Under this scenario the company would have a lower level of retained earnings which would reduce the amount of additional funds needed.
V. Under this scenario the company would have a lower level of retained earnings but this would have no effect on the amount of additional funds needed.
-Select-

Homework Answers

Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
Problem 12-03 AFN Equation Broussard Skateboard's sales are expected to increase by 15% from $7.4 million...
Problem 12-03 AFN Equation Broussard Skateboard's sales are expected to increase by 15% from $7.4 million in 2016 to $8.51 million in 2017. Its assets totaled $4 million at the end of 2016. Broussard is already at full capacity, so its assets must grow at the same rate as projected sales. At the end of 2016, current liabilities were $1.4 million, consisting of $450,000 of accounts payable, $500,000 of notes payable, and $450,000 of accruals. The after-tax profit margin is...
Problem 12-03 AFN Equation Broussard Skateboard's sales are expected to increase by 20% from $8.4 million...
Problem 12-03 AFN Equation Broussard Skateboard's sales are expected to increase by 20% from $8.4 million in 2016 to $10.08 million in 2017. Its assets totaled $5 million at the end of 2016. Broussard is already at full capacity, so its assets must grow at the same rate as projected sales. At the end of 2016, current liabilities were $1.4 million, consisting of $450,000 of accounts payable, $500,000 of notes payable, and $450,000 of accruals. The after-tax profit margin is...
AFN Equation Broussard Skateboard's sales are expected to increase by 25% from $9.0 million in 2015...
AFN Equation Broussard Skateboard's sales are expected to increase by 25% from $9.0 million in 2015 to $11.25 million in 2016. Its assets totaled $5 million at the end of 2015. Baxter is already at full capacity, so its assets must grow at the same rate as projected sales. At the end of 2015, current liabilities were $1.4 million, consisting of $450,000 of accounts payable, $500,000 of notes payable, and $450,000 of accruals. The after-tax profit margin is forecasted to...
AFN Equation Broussard Skateboard's sales are expected to increase by 15% from $7.2 million in 2016...
AFN Equation Broussard Skateboard's sales are expected to increase by 15% from $7.2 million in 2016 to $8.28 million in 2017. Its assets totaled $4 million at the end of 2016. Broussard is already at full capacity, so its assets must grow at the same rate as projected sales. At the end of 2016, current liabilities were $1.4 million, consisting of $450,000 of accounts payable, $500,000 of notes payable, and $450,000 of accruals. The after-tax profit margin is forecasted to...
AFN EQUATION Carlsbad Corporation's sales are expected to increase from $5 million in 2016 to $6...
AFN EQUATION Carlsbad Corporation's sales are expected to increase from $5 million in 2016 to $6 million in 2017, or by 20%. Its assets totaled $3 million at the end of 2016. Carlsbad is at full capacity, so its assets must grow in proportion to projected sales. At the end of 2016, current liabilities are $1 million, consisting of $250,000 of accounts payable, $500,000 of notes payable, and $250,000 of accrued liabilities. Its profit margin is forecasted to be 7%....
AFN EQUATION Carlsbad Corporation's sales are expected to increase from $5 million in 2016 to $6...
AFN EQUATION Carlsbad Corporation's sales are expected to increase from $5 million in 2016 to $6 million in 2017, or by 20%. Its assets totaled $3 million at the end of 2016. Carlsbad is at full capacity, so its assets must grow in proportion to projected sales. At the end of 2016, current liabilities are $1 million, consisting of $250,000 of accounts payable, $500,000 of notes payable, and $250,000 of accrued liabilities. Its profit margin is forecasted to be 7%....
AFN Equation Broussard Skateboard's sales are expected to increase by 20% from $7.8 million in 2016...
AFN Equation Broussard Skateboard's sales are expected to increase by 20% from $7.8 million in 2016 to $9.36 million in 2017. Its assets totaled $5 million at the end of 2016. Baxter is already at full capacity, so its assets must grow at the same rate as projected sales. At the end of 2016, current liabilities were $1.4 million, consisting of $450,000 of accounts payable, $500,000 of notes payable, and $450,000 of accruals. The after-tax profit margin is forecasted to...
AFN equation Broussard Skateboard's sales are expected to increase by 15% from $7.8 million in 2016...
AFN equation Broussard Skateboard's sales are expected to increase by 15% from $7.8 million in 2016 to $8.97 million in 2017. Its assets totaled $4 million at the end of 2016. Broussard is already at full capacity, so its assets must grow at the same rate as projected sales. At the end of 2016, current liabilities were $1.4 million, consisting of $450,000 of accounts payable, $500,000 of notes payable, and $450,000 of accruals. The after-tax profit margin is forecasted to...
AFN EQUATION Broussard Skateboard's sales are expected to increase by 15% from $8.6 million in 2016...
AFN EQUATION Broussard Skateboard's sales are expected to increase by 15% from $8.6 million in 2016 to $9.89 million in 2017. Its assets totaled $2 million at the end of 2016. Broussard is already at full capacity, so its assets must grow at the same rate as projected sales. At the end of 2016, current liabilities were $1.4 million, consisting of $450,000 of accounts payable, $500,000 of notes payable, and $450,000 of accruals. The after-tax profit margin is forecasted to...
AFN equation Broussard Skateboard's sales are expected to increase by 15% from $7.6 million in 2016...
AFN equation Broussard Skateboard's sales are expected to increase by 15% from $7.6 million in 2016 to $8.74 million in 2017. Its assets totaled $4 million at the end of 2016. Broussard is already at full capacity, so its assets must grow at the same rate as projected sales. At the end of 2016, current liabilities were $1.4 million, consisting of $450,000 of accounts payable, $500,000 of notes payable, and $450,000 of accruals. The after-tax profit margin is forecasted to...
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT