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The most recent financial statements for Throwing Copper Co. are shown here:

Income statement                                                  Balance Sheet

   Sales $50000            current assets             $78300      Long-term debt    $54000

   Costs 32000              Fixed assets                 43200         Equity                       67500

   Taxable Income 18000 total                       $121500    Total                         $121500

    Taxes(33%)    5940

       Net Income $12060                                    

Assets and costs are proportional to sales. The company maintains a constant 32 percent dividend payout ratio and a constant debt−equity ratio.

Required:

What is the maximum increase in sales that can be sustained assuming no new equity is issued? (Do not round your intermediate calculations.)

Financial Management, Finance

  • Category:- Financial Management
  • Reference No.:- M92099787

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