Current balances in liability and equity accounts: Total liabilities: $28,059,085, Common Stock: $13,308,000, Retained Earnings: $59,143,173. Next year the company generates $36,000,000 in net profit and pays $15,000,000 in dividends. Total Liabilities and Common Stock remain unchanged. What will total assets be next year?

Current balances in liability and equity accounts: Total liabilities: $28,059,085, Common Stock: $13,308,000, Retained Earnings: $59,143,173. Next year the company generates $36,000,000 in net profit and pays $15,000,000 in dividends. Total Liabilities and Common Stock remain unchanged. What will total assets be next year?

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

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The 2019 financial statements for Growth Industries are presented below. INCOME STATEMENT, 2019 Sales $ 340,000 Costs 220,000 EBIT $ 120,000 Interest expense 24,000 Taxable income $ 96,000 Taxes (at 21%) 20,160 Net income $ 75,840 Dividends $ 22,752 Addition to retained earnings $ 53,088 BALANCE SHEET, YEAR-END, 2019 Assets Liabilities Current assets Current liabilities Cash $ 3,000 Accounts payable $ 10,000 Accounts receivable 8,000 Total current liabilities $ 10,000 Inventories 29,000 Long-term debt 240,000 Total current assets $ 40,000 Stockholders’ equity Net plant and equipment 280,000 Common stock plus additional paid-in capital 15,000 Retained earnings 55,000 Total assets $ 320,000 Total liabilities plus stockholders' equity $ 320,000 Sales and…
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At last year’s end, total assets for Roberts Inc. were $1.2 million and accounts payable were $375,000. Sales, which last year were $2.5 million, are expected to increase by 25 percent this year. Total assets and accounts payable are proportional to sales, and that relationship will be maintained. Robert Inc. typically uses no current liabilities other than accounts payable. Common stock amounted to $425,000 last year, and retained earnings were $295,000. Roberts Inc. plans to sell new common stock in the amount of $75,000. The Firm’s profit margin on sales is 6 percent; and 60 percent of earnings will be retained. Set up Roberts Inc.’s last year balance sheet, to the extent possible, based on the information provided in this problem. Based on the balance sheet setup in Part a above, determine how much was Roberts Inc.’s long-term debt last year? Perform financial forecasting using percent of sales method (i.e., constant ratio method; do not use the AFN Equation) to determine how much…
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