The most recent financial statements for Scott, Inc., appear below. Sales for 2020 are projected to...

 

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The most recent financial statements for Scott, Inc., appear below. Sales for 2020 are projected to grow by 30 percent. Interest expense will remain constant; the tax rate and the dividend payout rate also will remain constant. Costs, other expenses, current assets, fixed assets, and accounts payable increase spontaneously with sales. SCOTT, INC. 2019 Income Statement Sales Costs Other expenses Earnings before interest and taxes Interest expense Taxable income Taxes (21%) Net Income $759,000 615,000 27,000 $ 117,000 12,400 $104,600 21,966 $ 82,634 Current assets Cash Assets Total SCOTT, INC. Balance Sheet as of December 31, 2019 $ 24,840 Accounts receivable 34,220 Inventory Fixed assets Net plant and equipment 71,060 Liabilities and Owners' Equity $216,000 Current liabilities Accounts payable Notes payable Total $ 130,120 Long-term debt Owners' equity Common stock and paid-in surplus Retained earnings Total Total liabilities and owners' $ 59,800 16,400 $ 76,200 $ 107,000 $106,000 56,920 $162,920 Total assets $346,120 Total liabilities and owners' equity EFN What is the EFN if the firm wishes to keep its debt-equity ratio constant? (Do not round intermediate calculations and round your answer to the nearest whole dollar amount, e.g., 32.) Answer is complete but not entirely correct. 5,006 X $346,120 The most recent financial statements for Scott, Inc., appear below. Sales for 2020 are projected to grow by 30 percent. Interest expense will remain constant; the tax rate and the dividend payout rate also will remain constant. Costs, other expenses, current assets, fixed assets, and accounts payable increase spontaneously with sales. SCOTT, INC. 2019 Income Statement Sales Costs Other expenses Earnings before interest and taxes Interest expense Taxable income Taxes (21%) Net Income $759,000 615,000 27,000 $ 117,000 12,400 $104,600 21,966 $ 82,634 Current assets Cash Assets Total SCOTT, INC. Balance Sheet as of December 31, 2019 $ 24,840 Accounts receivable 34,220 Inventory Fixed assets Net plant and equipment 71,060 Liabilities and Owners' Equity $216,000 Current liabilities Accounts payable Notes payable Total $ 130,120 Long-term debt Owners' equity Common stock and paid-in surplus Retained earnings Total Total liabilities and owners' $ 59,800 16,400 $ 76,200 $ 107,000 $106,000 56,920 $162,920 Total assets $346,120 Total liabilities and owners' equity EFN What is the EFN if the firm wishes to keep its debt-equity ratio constant? (Do not round intermediate calculations and round your answer to the nearest whole dollar amount, e.g., 32.) Answer is complete but not entirely correct. 5,006 X $346,120

Answer rating: 100% (QA)

1 2 Particulars 3 Sales 7590001 30 4 Costs 615000 1 30 A In... View the full answer