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Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:The most recent financial statements for Martin, Inc., are shown here:
Income Statement
Sales
Costs
Taxable income
Taxes (21%)
Net income
Assets
Total
EFN
$25,000
-15,000
$102,500
$102,500
$10,000
-2,100
$7,900
Balance Sheet
Debt
Equity
Total
$40,000
62,500
$102,500
Assets and costs are proportional to sales. Debt and equity are not. A dividend of $1,015 was paid, and Martin wishes to maintain a
constant payout ratio. Next year's sales are projected to be $31,000. What is the external financing needed? (Do not round
intermediate calculations. Round your answer to 2 decimal places.)
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