Managerial Finance Ch 3 exam with |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\
correct answers |||\\\
Minus the changes in both liabilities and equity - correct answer✔✔In the financial planning
|||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\
model, the external financing needed (EFN) as shown on a pro forma balance sheet is equal to
|||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\
the changes in assets:|||\\\ |||\\\ |||\\\
$2,628 (Using EFN = change in total assets - addition to RE) - correct answer✔✔For the year
|||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\
just ended, Shriftman Fabrics reported total sales of $12,000, costs of 8,952, total assets of
|||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\
$27,200, total liabilities of $7,400, and total equity of $19,800. The company does not pay
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dividends. Assume that all costs and assets change spontaneously with sales. The tax rate and
|||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\
dividend payout ratios remain constant. Next year's revenue is expected to be $14,820. What
|||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\
will be the amount of external financing needed to support this increase in sales? Assume the
|||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\
firm is currently operating at full capacity.
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Increase the total asset turnover - correct answer✔✔One way to increase a firm's sustainable
|||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\
rate of growth is to: |||\\\ |||\\\ |||\\\ |||\\\
-$13,490 - correct answer✔✔Freeze Ice Creams has total assets of $591,600, current liabilities
|||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\
of $49,700, dividends paid of $12,000, net sales of $68,400, and net income of $55,400.
|||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\
Assume that all costs, assets, and current liabilities change spontaneously with sales. The tax
|||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\
rate and dividend payout ratios remain constant. If the firm's managers project a firm growth
|||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\
rate of 6 percent for next year, what will be the amount of external financing needed to
|||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\
support this level of growth? Assume the firm is currently operating at full capacity.
|||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\
is normally higher than the internal growth rate - correct answer✔✔The sustainable growth
|||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\
rate:
The sustainable rate of growth - correct answer✔✔Paulhill Organic Produce wants to maintain
|||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\
its current dividend policy, which is a payout ratio of 25 percent. The firm does not want to
|||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\
correct answers |||\\\
Minus the changes in both liabilities and equity - correct answer✔✔In the financial planning
|||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\
model, the external financing needed (EFN) as shown on a pro forma balance sheet is equal to
|||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\
the changes in assets:|||\\\ |||\\\ |||\\\
$2,628 (Using EFN = change in total assets - addition to RE) - correct answer✔✔For the year
|||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\
just ended, Shriftman Fabrics reported total sales of $12,000, costs of 8,952, total assets of
|||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\
$27,200, total liabilities of $7,400, and total equity of $19,800. The company does not pay
|||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\
dividends. Assume that all costs and assets change spontaneously with sales. The tax rate and
|||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\
dividend payout ratios remain constant. Next year's revenue is expected to be $14,820. What
|||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\
will be the amount of external financing needed to support this increase in sales? Assume the
|||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\
firm is currently operating at full capacity.
|||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\
Increase the total asset turnover - correct answer✔✔One way to increase a firm's sustainable
|||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\
rate of growth is to: |||\\\ |||\\\ |||\\\ |||\\\
-$13,490 - correct answer✔✔Freeze Ice Creams has total assets of $591,600, current liabilities
|||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\
of $49,700, dividends paid of $12,000, net sales of $68,400, and net income of $55,400.
|||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\
Assume that all costs, assets, and current liabilities change spontaneously with sales. The tax
|||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\
rate and dividend payout ratios remain constant. If the firm's managers project a firm growth
|||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\
rate of 6 percent for next year, what will be the amount of external financing needed to
|||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\
support this level of growth? Assume the firm is currently operating at full capacity.
|||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\
is normally higher than the internal growth rate - correct answer✔✔The sustainable growth
|||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\
rate:
The sustainable rate of growth - correct answer✔✔Paulhill Organic Produce wants to maintain
|||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\ |||\\\
its current dividend policy, which is a payout ratio of 25 percent. The firm does not want to
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