(Forecasting financing needs) Beason Manufacturing forecasts its sales next year to be $5.4 million and expects to earn 4.9 percent of that amount after taxes. The firm is currently in the processof projecting its financing needs and has made the following assumptions (projections):• Current assets are equal to 19.8 percent of sales, and fixed assets remain at their current level of $0.8 million.• Common equity is currently $0.78 million, and the firm pays out half of its after-tax earnings in dividends.The firm has short-term payables and trade credit that normally equal 11.8 percent of sales, and it has no long-term debt outstanding.What are Beason's financing needs for the coming year?Beason's expected net income for next year is $(Round to the nearest dollar.)

Net income refers to an amount that is being earned by the company from its business after deducting…

Answered: Forecasting financing needs) Beason…

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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