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The most recent financial statements for Locke, Inc., are shown here: INCOME STATEMENT $51,000 41,500 BALANCE SHEET Sales Assets $114,100 $33,600 80,500 Debt Costs Equity Taxable income $ 9,500 Total $114,100 Total $ 114,100 Taxes (21%) 1,995 Net income $ 7,505 Assets and costs are proportional to sales; debt and equity are not. A dividend of $2,800 was paid, and the company wishes to maintain a constant payout ratio. Next year's sales are projected to be $59,160. What is the external financing needed? (Do not round intermediate calculations and enter your answer to the nearest whole number, e.g., 32.) E financing needed

The most recent financial statements for Locke, Inc., are shown here: INCOME STATEMENT $51,000 41,500 BALANCE SHEET Sales Assets $114,100 $33,600 80,500 Debt Costs Equity Taxable income $ 9,500 Total $114,100 Total $ 114,100 Taxes (21%) 1,995 Net income $ 7,505 Assets and costs are proportional to sales; debt and equity are not. A dividend of $2,800 was paid, and the company wishes to maintain a constant payout ratio. Next year's sales are projected to be $59,160. What is the external financing needed? (Do not round intermediate calculations and enter your answer to the nearest whole number, e.g., 32.) E financing needed

Essentials Of Investments
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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**Financial Overview: Locke, Inc.** The table below provides the latest financial statements for Locke, Inc., showcasing their income statement and balance sheet figures. **Income Statement:** - **Sales:** $51,000 - **Costs:** $41,500 - **Taxable Income:** $9,500 - **Taxes (21%):** $1,995 - **Net Income:** $7,505 **Balance Sheet:** - **Assets:** $114,100 - **Debt:** $33,600 - **Equity:** $80,500 - **Total:** $114,100 **Analysis Notes:** - Assets and costs vary with sales, while debt and equity do not. - The company paid a dividend of $2,800 and aims to keep a consistent payout ratio. - Sales for the next year are predicted to increase to $59,160. **Financial Calculation:** - A question posed asks for the external financing needed. Relevant details include maintaining the sales-costs proportionality and the constant payout ratio. The solution requires entering the answer as a whole number.
Transcribed Image Text:**Financial Overview: Locke, Inc.** The table below provides the latest financial statements for Locke, Inc., showcasing their income statement and balance sheet figures. **Income Statement:** - **Sales:** $51,000 - **Costs:** $41,500 - **Taxable Income:** $9,500 - **Taxes (21%):** $1,995 - **Net Income:** $7,505 **Balance Sheet:** - **Assets:** $114,100 - **Debt:** $33,600 - **Equity:** $80,500 - **Total:** $114,100 **Analysis Notes:** - Assets and costs vary with sales, while debt and equity do not. - The company paid a dividend of $2,800 and aims to keep a consistent payout ratio. - Sales for the next year are predicted to increase to $59,160. **Financial Calculation:** - A question posed asks for the external financing needed. Relevant details include maintaining the sales-costs proportionality and the constant payout ratio. The solution requires entering the answer as a whole number.
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The most recent financial statements for Locke, Inc., are shown here:
 
INCOME STATEMENT   BALANCE SHEET  
  Sales $ 64,000     Assets $ 134,900     Debt $ 45,300  
  Costs   53,200             Equity   89,600  
                       
  Taxable income $ 10,800       Total $ 134,900       Total $ 134,900  
  Taxes (24%)   2,592                  
                       
    Net income $ 8,208                  
                       
 
 
Assets and costs are proportional to sales; debt and equity are not. A dividend of $4,100 was paid, and the company wishes to maintain a constant payout ratio. Next year’s sales are projected to be $75,520.
 
What is the external financing needed?
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