ABC service generated $2 million in sales during 2009, and its year-end total assets were $1.5 million. Also, at year-end 2009, current liabilities were $500,000, consisting of $200,000 of notes payable, $200,000 of accounts payable, and $100,000 of accruals. Looking ahead to 2010, the company estimates that its assets must increase by 7 cents for every $1 increase in sales. ABC service’s profit margin is 5% and its payout ratio is 60%. How large a sales increase can the company achieve without having to raise funds externally?
0 Answers | Be the first to answer
We’ve answered 287,672 questions. We can answer yours, too.Ask a question