(Financial forecasting) Sambonoza Enterprises projects its sales next year to be $3 million and expects to earn 5 percent of that amount after taxes. The firm is currently in the process of projectin its financing needs and has made the following assumptions (projections): 1. Current assets will equal 22 percent of sales, and fixed assets will remain at their current level of $1 million. 2. Common equity is currently $0.90 million, and the firm pays out half of its after-tax earnings in dividends. 3. The firm has short-term payables and trade credit that normally equal 9 percent of sales, and it has no long-term debt outstanding. What are Sambonoza's financing needs for the coming year? Sambonoza's financing needs for the coming year are $ million. (Round to two decimal places.)
(Financial forecasting) Sambonoza Enterprises projects its sales next year to be $3 million and expects to earn 5 percent of that amount after taxes. The firm is currently in the process of projectin its financing needs and has made the following assumptions (projections): 1. Current assets will equal 22 percent of sales, and fixed assets will remain at their current level of $1 million. 2. Common equity is currently $0.90 million, and the firm pays out half of its after-tax earnings in dividends. 3. The firm has short-term payables and trade credit that normally equal 9 percent of sales, and it has no long-term debt outstanding. What are Sambonoza's financing needs for the coming year? Sambonoza's financing needs for the coming year are $ million. (Round to two decimal places.)
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
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Transcribed Image Text:(Financial forecasting) Sambonoza Enterprises projects its sales next year to be $3 million and expects to earn 5 percent of that amount after taxes. The firm is currently in the process of projecting
its financing needs and has made the following assumptions (projections):
1. Current assets will equal 22 percent of sales, and fixed assets will remain at their current level of $1 million.
2. Common equity is currently $0.90 million, and the firm pays out half of its after-tax earnings in dividends.
3. The firm has short-term payables and trade credit that normally equal 9 percent of sales, and it has no long-term debt outstanding.
What are Sambonoza's financing needs for the coming year?
Sambonoza's financing needs for the coming year are $ million. (Round to two decimal places.)
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