Ask Question, Ask an Expert

+1-415-315-9853

info@mywordsolution.com

Ask Basic Finance Expert

Cranberry Corporation Income Statement ($ in millions)

Sales

$300

Costs

  250

EBT

mce_markernbsp; 50

Taxes (34%)

    17

Net income

mce_markernbsp; 33

Retained earnings

mce_markernbsp; 22

Dividends

mce_markernbsp; 11

Cranberry Corporation Balance Sheet  ($ in millions)

Cash

$5

 

Accounts payable

$ 40

Accounts receivables

40

 

Notes payable

   30

Inventory

    65

 

Current liabilities

mce_markernbsp; 70

Current assets

$110

 

Long-term debt

155

Net plant & equip.

  290

 

Common stock

75

 

 

 

Retained earnings

  100

Total assets

$400

 

Total liab.  & equity

$400

[A] Suppose a constant profit margin, find Cranberry Corporation's net income be if sales increase by 10 percent?

[B] Find Cranberry Corporation's addition to retained earnings with a 10% increase in sales? Suppose the dividend payout ratio and profit margin remains fixed.

[C] Suppose Cranberry Corporation is operating at full capacity. What will total assets be if sales rise by 10 percent? Suppose costs, current liabilities, and current assets vary directly with sales and that the dividend payout ratio remains unchanged.

[D] Suppose Cranberry Corporation is using its fixed assets at 90% capacity.  Suppose costs, current liabilities, and current assets vary directly with sales, and that the dividend payout ratio remains unchanged.  If sales increase by 20 percent, what will total fixed assets be?

[E] How much external financing is needed for a 20% increase in sales if the Corporation is currently operating at full capacity? Suppose assets and costs vary directly with sales but no current liabilities increase with sales and that the dividend payout ratio remains fixed.

Basic Finance, Finance

  • Category:- Basic Finance
  • Reference No.:- M921365

Have any Question? 


Related Questions in Basic Finance

1 what is meant by purchasing authority give examples of

1. What is meant by purchasing authority? Give examples of each type of purchasing authority. 2. Discuss the liability issues associated with purchasing agents' actions. Minimum 3 references.

1 what changes to disaster recovery programs were being

1. What changes to disaster recovery programs were being proposed in 2009? 2. Investigate how civil defense and emergency management evolved in your state or city. Look at such factors as when it was created, its origina ...

Explain how a swaption can be terminated at expiration by

Explain how a swaption can be terminated at expiration by either exercising it or settling it in cash. Why are these procedures financially equivalent? Explain how the two types of swaptions are like interest rate option ...

In early 2010 newspapers reported that nba superstar kobe

In early 2010, newspapers reported that NBA superstar Kobe Bryant had signed an extension to his existing contract. His salaries in future years under the contract extension would be as follows: For the season ending in ...

1 what is counterparty risk what counterparty risk is

1. What is counterparty risk? What counterparty risk is involved with forward contracts? Why are investors and firms that enter forward contracts willing to accept counterparty risk? 2. What are the key differences betwe ...

1 describe how and why a bonds interest rate risk is

1. Describe how and why a bond's interest rate risk is related to its maturity. 2. Explain why municipal bonds can offer lower interest rates than equally risky corporate bonds. 3. Explain why the yield to maturity on a ...

1 holding the cutoff period fixed which method has a more

1. Holding the cutoff period fixed, which method has a more severe bias against long-lived projects, payback or discounted payback? 2. For a firm that uses the NPV rule to make investment decisions, what consequences res ...

Toynbspcorp produces and sells pinball machines its average

Toy Corp. produces and sells pinball machines. Its average selling price is currently $5,400 per game. Based on a review of its projected financial statements, the company's variable costs are $2,800 per unit sold and to ...

1 suppose that apples profits are expected to grow twice as

1. Suppose that Apple's profits are expected to grow twice as fast as Microsoft's. Which firm's stock should be the better investment? Briefly explain. 2. Henry Blodget worked for Merrill Lynch during the dot-com boom. T ...

For each of the following scenarios identify which sampling

For each of the following scenarios, identify which sampling method is used: a. The State College is conducting a survey of student attitudes and opinions. The plan is to use the list of all registered students and rando ...

  • 4,153,160 Questions Asked
  • 13,132 Experts
  • 2,558,936 Questions Answered

Ask Experts for help!!

Looking for Assignment Help?

Start excelling in your Courses, Get help with Assignment

Write us your full requirement for evaluation and you will receive response within 20 minutes turnaround time.

Ask Now Help with Problems, Get a Best Answer

Section onea in an atwood machine suppose two objects of

SECTION ONE (a) In an Atwood Machine, suppose two objects of unequal mass are hung vertically over a frictionless

Part 1you work in hr for a company that operates a factory

Part 1: You work in HR for a company that operates a factory manufacturing fiberglass. There are several hundred empl

Details on advanced accounting paperthis paper is intended

DETAILS ON ADVANCED ACCOUNTING PAPER This paper is intended for students to apply the theoretical knowledge around ac

Create a provider database and related reports and queries

Create a provider database and related reports and queries to capture contact information for potential PC component pro

Describe what you learned about the impact of economic

Describe what you learned about the impact of economic, social, and demographic trends affecting the US labor environmen