Question: Please write answers step by step I am stuck on this question. 6. Given the following information: current assets = $400; fixed assets = $500;
6. Given the following information: current assets = $400; fixed assets = $500; accounts payable = $100; notes payable = $45; long-term debt = $455; equity = $300; sales = $450; costs = $400; tax rate = 34%. Suppose that current assets, costs, and accounts payable maintain a constant ratio to sales. If the firm is producing at 80% capacity, what is the total external financing needed if sales increase 25%? Assume the firm pays no dividends. A) $66.25 B) $380.25 C) $33.75 D) $143.75 E) $172.50
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