Your firm recently reported sales of $100 million, and net income equal to $5 million. The…


Your secure recently reputed sales of $100 favorite, and net proceeds resembling to $5 favorite. The fraternity has $70 favorite in aggregate possessions. Over the direct year, the fraternity is prospect a 20 percent acception in sales. Since the fraternity is at unmeasured compressiveness, its possessions must acception in correlation to sales. The fraternity too estimates that if sales acception 20 percent, gratuitous liabilities get acception by $2 favorite. If the fraternity's sales acception, its benefit-service loophole get halt at its floating plane. The fraternity's dividend payout appurtenancy is 40 percent.
Document Preview:

Your secure recently reputed sales of $100 favorite, and net proceeds resembling to $5 favorite. The fraternity has $70 favorite in aggregate possessions. Over the direct year, the fraternity is prospect a 20 percent acception in sales. Since the fraternity is at unmeasured compressiveness, its possessions must acception in correlation to sales. The fraternity too estimates that if sales acception 20 percent, gratuitous liabilities get acception by $2 favorite. If the fraternity's sales acception, its benefit-service loophole get halt at its floating plane. The fraternity's dividend payout appurtenancy is 40 percent. Based on the AFN formula, how considerable additional principal must the fraternity construct in classify to maintenance the 20 percent acception in sales?   A.$ 8.4 favorite  B.$ 9.0 favorite  C.$15.1 favoriteD.$10.4 favorite  E.$ 4.8 favoriteAnswer Key: A Over the gone-by indelicate years, a well-planned fraternity has had the forthcoming connect among its inventories and its sales: YearSalesInventories2001$200 favorite$35 favorite2002220 favorite38 favorite2003400 favorite55 favorite2004500 favorite70 favoriteThe fraternity is in the course of generating its apprehended financial statements for 2005. The fraternity leading generates a apprehend for sales and then, consecrated its sales apprehend, uses a retreat design (using basis consecrated overhead) to apprehend its inventories for 2005. Assuming that the apprehended sales for 2005 are $650 favorite, what are its apprehended inventories for 2005?   A.$86.18 favoriteB.$87.80 favorite  C.$85.27 favorite  D.$83.12 favorite  E.$88.20 favoriteAnswer Key: C Your secure has the forthcoming et fencing as of December 31, 2004. Current possessions$600,000Accounts payable$ 100,000Fixed Assets400,000Accrued Liabilities100,000  Notes Payable100,000  Long-term debt300,000  Total base equity400,000    Total Assets$ 1,000,000Total liabilities and equity$ 1,000,000In 2004, the fraternity reputed sales of $5 favorite. The fraternity anticipates its sales get acception 25...

Attachments: