Suppose that Gyp Sum Industries currently has the balance sheet shown below, and that sales for the year just ended were $10.9 million. The firm also has a profit margin of 25 percent and a retention ratio of 30 percent, and expects sales of $8.9 million next year. Assets Current assets Fixed assets Total assets $ 2,621,000 4,900,000 $ 7,521,000 Liabilities and Equity Current liabilities Long-term debt Equity Total liabilities and equity Additional funds needed S If all assets and current liabilities are expected to shrink with sales, what amount of additional funds will Gyp Sum need from external sources to fund the expected growth? Note: Enter your answer in dollars not in millions. Negative amount should be indicated by a minus sign. Answer is complete but not entirely correct. (243,300) $ 2,557,140 1,950,000 3,013,860 $ 7,521,000
Suppose that Gyp Sum Industries currently has the balance sheet shown below, and that sales for the year just ended were $10.9 million. The firm also has a profit margin of 25 percent and a retention ratio of 30 percent, and expects sales of $8.9 million next year. Assets Current assets Fixed assets Total assets $ 2,621,000 4,900,000 $ 7,521,000 Liabilities and Equity Current liabilities Long-term debt Equity Total liabilities and equity Additional funds needed S If all assets and current liabilities are expected to shrink with sales, what amount of additional funds will Gyp Sum need from external sources to fund the expected growth? Note: Enter your answer in dollars not in millions. Negative amount should be indicated by a minus sign. Answer is complete but not entirely correct. (243,300) $ 2,557,140 1,950,000 3,013,860 $ 7,521,000
Chapter4: Financial Planning And Forecasting
Section: Chapter Questions
Problem 10P
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![Suppose that Gyp Sum Industries currently has the balance sheet shown below, and that sales for the year just ended were $10.9
million. The firm also has a profit margin of 25 percent and a retention ratio of 30 percent, and expects sales of $8.9 million next year.
Assets
Current assets
Fixed assets
Total assets
$ 2,621,000
4,900,000
$ 7,521,000
Liabilities and Equity
Current liabilities
Long-term debt
Equity
Total liabilities and equity
If all assets and current liabilities are expected to shrink with sales, what amount of additional funds will Gyp Sum need from external
sources to fund the expected growth?
Note: Enter your answer in dollars not in millions. Negative amount should be indicated by a minus sign.
X Answer is complete but not entirely correct.
Additional funds needed
(243,300) X
$ 2,557,140
1,950,000
3,013,860
$ 7,521,000](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F7027a34f-2fe8-411c-976f-66458773ba91%2F352b1fbe-0167-4c40-b308-ae7f7594a29b%2Fzhbg6a_processed.png&w=3840&q=75)
Transcribed Image Text:Suppose that Gyp Sum Industries currently has the balance sheet shown below, and that sales for the year just ended were $10.9
million. The firm also has a profit margin of 25 percent and a retention ratio of 30 percent, and expects sales of $8.9 million next year.
Assets
Current assets
Fixed assets
Total assets
$ 2,621,000
4,900,000
$ 7,521,000
Liabilities and Equity
Current liabilities
Long-term debt
Equity
Total liabilities and equity
If all assets and current liabilities are expected to shrink with sales, what amount of additional funds will Gyp Sum need from external
sources to fund the expected growth?
Note: Enter your answer in dollars not in millions. Negative amount should be indicated by a minus sign.
X Answer is complete but not entirely correct.
Additional funds needed
(243,300) X
$ 2,557,140
1,950,000
3,013,860
$ 7,521,000
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