Given the compressed version of balance sheet and income statement, estimate the amount of external financing needed to increase sales by 20% next year (use percentage of sales method).
(Dividend payout is 50%)
Balance Sheet (End of the Year)
Assets $2,000 Debt $1000
Total $2000 $2000
Net Income 200.
External financing requirement = [(total assets/sales) x change in sales] - ...
Percentage Sales Method is expressed in the solution.