The most recent financial statements for GPS, Inc., are shown here: Income Statement Balance...
Question:
The most recent financial statements for GPS, Inc., are shown here:
| Income Statement | Balance Sheet | ||||
|---|---|---|---|---|---|
| Sales | $22,400 | Assets | $120,000 | Debt | $46,600 |
| Costs | 15,500 | Equity | 73,400 | ||
| Taxable income | $6,900 | Total | $120,000 | Total | $120,000 |
| Taxes (30%) | 2,070 | ||||
| Net income | $4,830 | ||||
Assets and costs are proportional to sales. Debt and equity are not. A dividend of $1,570 was paid, and the company wishes to maintain a constant payout ratio. Next year's sales are projected to be $28,100.
Required:
What is the external financing needed?
Income statement
Income statement is company financial performance report which shows the total operating revenue and expenses of the firm over a certain range of period. It is primarily used by the managers to evaluate the profitability of the firm to make an inform decision.
Answer and Explanation: 1
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View this answerFirst, let's calculate the growth rate Heine, Inc. sales using the formula below
{eq}\begin{align*} Sales~growth~rate&=\frac{Expected~sales}{Current...
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Contribution Margin vs. Traditional Income Statements
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Chapter 2 / Lesson 10
15K
Contribution margin income statements subtract variable costs from the total sales, whereas traditional income statements subtract groups of different costs from total sales. Differentiate between these two income statements to see their applications.
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