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1. Baxter Box Company's balance sheet showed the f...




1. Baxter Box Company's balance sheet showed the following amounts as of December 31st: Cash $ 10 Accounts payable $ 15 Accounts receivable 40 Accruals 5 Inventory 50 Notes payable 20 Net fixed assets 100 Long-term debt 20 Common stock 20 Retained earnings 120 Total assets $200 Total liabilities and equity $200 Last year the firm's sales were $2,000, and it had a profit margin of 10 percent and a dividend payout ratio of 50 percent. Baxter Box operated its fixed assets at 80 percent of capacity during the year. The company expects to increase next year's sales by 37.5 percent, to $2,750, but the profit margin is expected to fall to 3 percent, and the dividend payout ratio is expected to rise to 60 percent. What is Baxter Box's additional funds needed (AFN) for next year?


Paper#8620 | Written in 18-Jul-2015

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