A company has total assets of $260,000, long-term debt of $90,000, shareholders' equity of $120,000, and current liabilities of $50,000. The dividend payout ratio is 40 percent, and the profit margin is is 7 percent. Assume that all current assets and liabilities change spontaneously with sales and that the business is currently operating at full capacity. 

What is the need for external financing if current sales of $300,000 are projected to increase by 10 percent?

Answer rating: 100% (QA)

ANSWER To calculate the need for external financing we need to first determine the increase in sales and its effect on the financial statements If cur... View the full answer