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717 PM 47% ezto.mheducation.com e Disney ESPN Yahool Best Buy E-Gift Cards from CashStar CatholicTV What will Transfer ope Things On Amazon Prime Tha Chp 04 Homework Favorites connect Question 8 (of 9) Save & Ext Submt 1.00 points Problem 4-27 Percent-of-sales method [LO4-3 100 millon, andthe balance sheet at Owen\'s Electronics has nine operating plants in seven soutwestern states Sales for last year were $ year-end is similar in percentage of sales to that of previous years (and this will continue in current lablises will vary directly with sales. The firm is working at full capacity. the future). All assets (including fwed assets) and Balance Sheet Liablines and Stockholders Equity 20 7 Accounts payablae 25 Aconed wages 28 Acoued taxes Current lablties Cument assets Fixed assets 45 Notes payable 30 S 105 $105 Total labilities and stockholders\' equity Total assets Owen\'s has an aftertax profit margin of 10 percent and a dividend payout ratio of 45 pencent year, determine how many dollars of new funds are needed to dolarns, not millions, (e-9-51.234.587) i intermediate caliculations. Enter your answer in References Book& Resources Oftouty Advanced Problem 427 Percent Leaming 0pective 04-03 of -sales method [LO4 The 0) forecasing on a les precise sk yout instructora questin Check my.wors

Solution

Here use AFN formuale to find the additional funds needed
Additional Funds Needed=(Ao×S/so)-(Lo×S/so)-(S1×PM×b)
Where,
Ao = current level of assets
S/So = percentage increase in sales i.e. change in sales divided by current sales
Lo = current level of liabilities
S1 = new level of sales
PM = profit margin
b = retention rate = 1 – payout rate
=(105*20%)-(40*20%)-(100*1.2*10%*55%)
=6.4mn
=6400000