You have been asked to forecast the additional funds needed (AFN) for Houston, Hargrove, & Worthington (HHW), which is planning its operation for the coming year. The firm is operating at full capacity. Data for use in the forecast are shown below. However, the CEO is concerned about the impact of a change in the payout ratio from the 10% that was used in the past to 45%, which the firm's investment bankers have recommended. Based on the AFN equation, by how much would the AFN for the coming year change if HHW increased the payout from 10% to the new and higher level? All dollars are in millions. Last year's sales So Sales growth rate g Last years total assets = Ap Last year's profit margin = PM Select the correct answer. O&$27.8 Ob 1326 03310 Od 5342 O 1294 $300.0 40% $500 20.0% Last year's accounts payable Last year's notes payable Last year's accruals Initial payout ratio $50.0 $15.0 $20.0 10.09
You have been asked to forecast the additional funds needed (AFN) for Houston, Hargrove, & Worthington (HHW), which is planning its operation for the coming year. The firm is operating at full capacity. Data for use in the forecast are shown below. However, the CEO is concerned about the impact of a change in the payout ratio from the 10% that was used in the past to 45%, which the firm's investment bankers have recommended. Based on the AFN equation, by how much would the AFN for the coming year change if HHW increased the payout from 10% to the new and higher level? All dollars are in millions. Last year's sales So Sales growth rate g Last years total assets = Ap Last year's profit margin = PM Select the correct answer. O&$27.8 Ob 1326 03310 Od 5342 O 1294 $300.0 40% $500 20.0% Last year's accounts payable Last year's notes payable Last year's accruals Initial payout ratio $50.0 $15.0 $20.0 10.09
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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Transcribed Image Text:15
You have been asked to forecast the additional funds needed (AFN) for Houston, Hargrove, & Worthington (HHW), which is planning its operation for the coming year.
The firm is operating at full capacity. Data for use in the forecast are shown below. However, the CEO is concerned about the impact of a change in the payout ratio from
the 10% that was used in the past to 45%, which the firm's investment bankers have recommended. Based on the AFN equation, by how much would the AFN for the
coming year change if HHW increased the payout from 10% to the new and higher level? All dollars are in millions.
Last year's sales So
Sales growth rate=g
Last years total assets = Ap*
Last year's profit margin = PM
Select the correct answer.
$27.8
53326
05310
Od $342
O 1294
Onky
$300.0
40%
$500
20.0%
Last year's accounts payable
Last years notes payable
Last year's accruals
initial payout ratio
Question 6 of 10
$50.0
$15.0
$20.0
10.09
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