External Financing
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Company X expects sales next year = $5,000,000.
Inventory and accounts receivable will increase $900,000 to accommodate this sales level.
The firm has a steady profit margin of 20% and 40% dividend payout.
How much external financing will the firm have to seek?
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Solution Summary
The solution explains how to calculate the external financing needed given the level of sales
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The increase in inventory and accounts receivable will need to be financed. The total amount required is $900,000 which is the ...
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