1. Morgan Manufacturing has the following abbreviated financial statements for the year ending today. Assets $60,000,000...

  

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1. Morgan Manufacturing has the following abbreviated financial statements for the year ending today. Assets $60,000,000 Operating liabilities $10,000,000 Short-term debt $5,000,000 Long-term debt $15,000,000 Equity $30,000,000 Liabilities + equity $50,000,000 Revenue $50,000,000 Operating expenses -%$42,000,000 EBIT S8,000.000 -Interest -$500,000 Revenue $50,000,000 -Operating expenses -$42,000,000 EBIT $8,000,000 -Interest -$500,000 -Taxes -$1,575,000 Net income $5,925,000 Suppose that Morgan forecasts a 20% increase in its revenue for the coming year. (a) Suppose that () assets, operating liabilities, and short-term debt will change in response to the change in revenue, (i) the firm intends to have a payout rate of 30%, and (i) the asset turnover ratio, the profit margin, and the $ amount of long-term debt are expected to be constant. What will be the external funds needed based on these assumptions? (Hint: use the equation and do not forecast entire new statements.) Upload Choose a File 1. Morgan Manufacturing has the following abbreviated financial statements for the year ending today. Assets $60,000,000 Operating liabilities $10,000,000 Short-term debt $5,000,000 Long-term debt $15,000,000 Equity $30,000,000 Liabilities + equity $50,000,000 Revenue $50,000,000 Operating expenses -%$42,000,000 EBIT S8,000.000 -Interest -$500,000 Revenue $50,000,000 -Operating expenses -$42,000,000 EBIT $8,000,000 -Interest -$500,000 -Taxes -$1,575,000 Net income $5,925,000 Suppose that Morgan forecasts a 20% increase in its revenue for the coming year. (a) Suppose that () assets, operating liabilities, and short-term debt will change in response to the change in revenue, (i) the firm intends to have a payout rate of 30%, and (i) the asset turnover ratio, the profit margin, and the $ amount of long-term debt are expected to be constant. What will be the external funds needed based on these assumptions? (Hint: use the equation and do not forecast entire new statements.) Upload Choose a File

Answer rating: 100% (QA)

Profit margin Net income Revenue 5925000 50000000 1185 N... View the full answer