Problem 4-4 EFN [LO2] The most recent financial statements for Cardinal, Inc., are shown here: Income Statement Balance Sheet Â Â Sales $ 31,000 Â Â Assets $ 73,200 Â Â Debt $ 36,700 Â Â Costs 18,400 Â Â Equity 36,500 Â Â Taxable...

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Finance

Problem 4-4 EFN [LO2]
The most recent financial statements for Cardinal, Inc., areshown here:
Income Statement Balance Sheet
Â Â Sales $ 31,000 Â Â Assets $ 73,200 Â Â Debt $ 36,700
Â Â Costs 18,400 Â Â Equity 36,500
Â Â Taxable income $ 12,600 Â Â Â Â Total $ 73,200 Â Â Â Â Total $ 73,200
Â Â Taxes (22%) 2,772
Â Â Â Â Net income $ 9,828
Assets and costs are proportional to sales. Debt and equity arenot. A dividend of $3,700 was paid, and the company wishes tomaintain a constant payout ratio. Next yearâ€™s sales are projectedto be $35,340.
What is the external financing needed? (Do not roundintermediate calculations.)

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3.8 Ratings (364 Votes)

Next years projected sales 35340 Current year sales 31000 of increase in sales next year Next year sales Current year sales Current year sales of increase in sales next year 35340 31000 31000 of increase in sales next year 014 or 14 Projected income statement for next year Sales See Answer

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Income Statement		Balance Sheet
Â Â Sales	$	31,000	Â Â Assets	$	73,200	Â Â Debt	$	36,700
Â Â Costs		18,400				Â Â Equity		36,500

Â Â Taxable income	$	12,600	Â Â Â Â Total	$	73,200	Â Â Â Â Total	$	73,200

Â Â Taxes (22%)		2,772

Â Â Â Â Net income	$	9,828