A company's sales in 2020 were $5.2 million and its total spontaneous assets were $3.2 million. Also in the same year, the firm's spontaneous liabilities consisted of $3.1 million in wages payable, $3.3 million in accounts payable, and $9.5 million in accrued expenses. The firm's profit margin is 6.8% and its dividend payout ratio is 5.5% The balance sheet at year-end is similar in percentage of sales to that of previous years and this will continue in the future. Required: What is the percentage increase in sales that the company must achieve in order to avoid raising funds externally? Note: The term "K'is used to represent thousands (*$1.000). % (ROUND YOUR ANSWER TO 2 DECIMAL PLACES. FOR EXAMPLE: 17.23)
A company's sales in 2020 were $5.2 million and its total spontaneous assets were $3.2 million. Also in the same year, the firm's spontaneous liabilities consisted of $3.1 million in wages payable, $3.3 million in accounts payable, and $9.5 million in accrued expenses. The firm's profit margin is 6.8% and its dividend payout ratio is 5.5% The balance sheet at year-end is similar in percentage of sales to that of previous years and this will continue in the future. Required: What is the percentage increase in sales that the company must achieve in order to avoid raising funds externally? Note: The term "K'is used to represent thousands (*$1.000). % (ROUND YOUR ANSWER TO 2 DECIMAL PLACES. FOR EXAMPLE: 17.23)
Chapter3: Evaluation Of Financial Performance
Section: Chapter Questions
Problem 13P
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![A company's sales in 2020 were $5.2 million and its total spontaneous assets were $3.2 million. Also in the same year, the firm's
spontaneous liabilities consisted of $3.1 million in wages payable. $3.3 million in accounts payable, and $9.5 million in accrued
expenses. The firm's profit margin is 6.8% and its dividend payout ratio is 5.5% The balance sheet at year-end is similar in percentage
of sales to that of previous years and this will continue in the future.
Required: What is the percentage increase in sales that the company must achieve in order to avoid raising funds externally?
Note: The term "k" is used to represent thousands (x $1.000).
% (ROUND YOUR ANSWER TO 2 DECIMAL PLACES. FOR EXAMPLE: 17.23)](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fae2c5a57-31e7-4eae-839d-d88b5b29a26d%2Ffd6700bc-cb71-4d30-9e3c-113183fbc3f0%2Fcmop1bi_processed.jpeg&w=3840&q=75)
Transcribed Image Text:A company's sales in 2020 were $5.2 million and its total spontaneous assets were $3.2 million. Also in the same year, the firm's
spontaneous liabilities consisted of $3.1 million in wages payable. $3.3 million in accounts payable, and $9.5 million in accrued
expenses. The firm's profit margin is 6.8% and its dividend payout ratio is 5.5% The balance sheet at year-end is similar in percentage
of sales to that of previous years and this will continue in the future.
Required: What is the percentage increase in sales that the company must achieve in order to avoid raising funds externally?
Note: The term "k" is used to represent thousands (x $1.000).
% (ROUND YOUR ANSWER TO 2 DECIMAL PLACES. FOR EXAMPLE: 17.23)
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