вход по аккаунту

код для вставкиСкачать
Q.How much additional external capital will be required for next year if sales
increase 15 percent? (Assume that the company is already operating at full
Increase in sales = 15% of $100 million = $15 Million
Corresponding increase in Assets = (5% + 15% + 25% +40%) of $15 mn = 85% of $15
mn = $12.75 mn
Corresponding increase in Liabilities = (15% + 10%) of 15 mn = 25% of 15 mn = $3.75
Profit = 6% of 115 mn = $6.9 mn ( as profit margin is 6%)
Out of this $6.9 mn, dividend payment will be 50% i.e $3.45 mn
Rest $3.45 is reatain earning, so this much amount company does not require as
additional capital.
So, required additional capital = increase in Assets - increase in Liabilities - Retained
= $12.75 mn - $3.75 mn - $3.45 mn = $5.55 million
Q.What will happen to external fund requirements if Landis Corporation reduces
the payout ratio, grows at a slower rate, or suffers a decline in its profit margin?
Discuss each of these separately.
1)Reduces the payout ratio- If payout ratio is reduced, company will pay less dividend to
the shareholders. So, more fund will remain with the company.Hence, external fund
requirement will reduce.
2)grows at a slower rate- If company grows at a slower rate, less asset will be created
hence fund requirement will be less. So, external fund requirement will reduce.
3)decline in its profit margin - If profit margin declines, company will have lesser profit
and hence lesser retained earning. So, requirement of external fund will increase.
Пожаловаться на содержимое документа