Please need answer the general accounting question Wagner Industrial Motors, which is currently operating at full capacity, has salesof $2,450, current assets of $790, current liabilities of $480, net fixed assets of$1,640, and a 5 percent profit margin. The firm has no long-term debt and doesnot plan on acquiring any. The firm does not pay any dividends. Sales are expectedto increase by 10 percent next year. If all assets, short-term liabilities, and costsvary directly with sales, how much additional equity financing is required for nextyear?a. $12.25b. $245.00c. $257.25d. $182.75e. $60.25

Step 1: Define Equity FinancingEquity financing is considered for the new issue of shares or any new…

Answered: Wagner Industrial Motors, which is…

EBK CONTEMPORARY FINANCIAL MANAGEMENT

14th Edition

ISBN:9781337514835

Author:MOYER

Publisher:MOYER

Chapter3: Evaluation Of Financial Performance

Section: Chapter Questions

Problem 7P

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Wagner Industrial Motors, which is currently operating at full capacity, has sales of $2,340, current assets of $680, current liabilities of $370, net fixed assets of $1,530, and a 5 percent profit margin. The firm has no long-term debt and does not plan on acquiring any. The firm does not pay any dividends. Sales are expected to increase by 10 percent next year. If all assets, short-term liabilities, and costs vary directly with sales, how much additional equity financing is required for next year? $172.30 $245.70 $234.00 $55.30 $11.70
Signature Corporation, which is currently operating at full capacity, has sales of $75,000, current assets of $4,500, current liabilities of $3,200, net fixed assets of $55,500, and a 10 percent profit margin. The firm has no long-term debt and does not plan on acquiring any. The firm does not pay any dividends. Sales are expected to increase by 8.5 percent next year. If all assets, short-term liabilities, and costs vary directly with sales, how much is the external financing need (EFN) for next year? O a. -$2,099.5 O b. -$3,309.5 O c. $4,201 O d. $5,914
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