Loose Leaf for Foundations of Financial Management Format: Loose-leaf
Loose Leaf for Foundations of Financial Management Format: Loose-leaf
17th Edition
ISBN: 9781260464924
Author: BLOCK
Publisher: Mcgraw Hill Publishers
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Chapter 4, Problem 3P

Galehouse Gas Stations Inc. expects sales to increase from $1,550,000 to $1,750,000 next year. Galehouse believes that net assets (Assets 2 Liabilities) will represent 50 percent of sales. His firm has an 8 percent return on sales and pays 45 percent of profits out as dividends.

a. What effect will this growth have on funds?

b. If the dividend payout is only 25 percent, what effect will this growth have on funds?

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Loose Leaf for Foundations of Financial Management Format: Loose-leaf

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