1NUS Business SchoolFIN2004 FinanceTutorial 9#1:The most recent financial statements for GPS, Inc., are provided below:Income StatementBalance SheetSales$19,500Current assets $98,000Debt$52,500Costs15,000-Taxableincome$4,500Equity45,500Taxes(40%)1,800Total$98,000Total$98,000Net income$2,700Assets and costs are proportional to sales.Debt and equity are not.A dividend of $1,400 waspaid, and the company wishes to maintain a constant payout ratio. Next year’s sales are projectedto be $21,840. What is the external financing needed?#2:The most recent financial statements for Summer Tyme, Inc., are provided below:Income StatementBalance SheetSales$4,200Current assets$3,600Current liabilities$2,100Costs3,300Fixed assets7,900Long-term debt3,650Taxableincome$900Equity5,750Taxes(34%)306Total$11,500Total$11,500Net income$594Assets, costs and current liabilities are proportional to sales.Long-term debt and equity are not.The company maintains a constant 40% dividend payout ratio.As with every other firm in its
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Finance,Balance Sheet,Generally Accepted Accounting Principles,payout ratio,NUS BUSINESS SCHOOL,recent financial statements