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Morrissey Technologies Inc
ADDITIONAL FUNDS NEEDED Morrissey Technologies Inc.'s 2014 financial statements are shown here.
Suppose that in 2015, sales increase by 10% over 2014 sales. The firm currently has 100,000 shares outstanding. It expects to maintain its 2014 dividend payout ratio and believes that its assets should grow at the same rate as sales. The firm has no excess capacity. However, the firm would like to reduce its Operating costs/Sales ratio to 87 5% and increase its total liabilities-to-assets ratio to 30%. (It believes its liabilities-to-assets ratio currently is too low relative to the industry average.) The firm will raise 30% of the 2015 forecasted interest bearing debt as notes payable, and it will issue long-term bonds for the remainder. The firm forecasts that its before-tax cost of debt (which includes both short-term and long-term debt) is 12 5%. Assume that any common stock issuances or repurchases can be made at the firm's current stock price of $45.
a. Construct the forecasted financial statements assuming that these changes are made. What are the firm's forecasted notes payable and long-term debt balances? What is the forecasted addition to retained earnings?
b. If the profit margin remains at 5% and the dividend payout ratio remains at 60%, at what growth rate in sales will the additional financing requirements be exactly zero? In other words, what is the firm's sustainable growth rate?
computing and using the cm rationbspnbsplast month when holiday creations inc. sold 50000 units total sales were 200000
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Calculate the Economic Life in STB/month for an oil lease with WI = 100%, NRI = 87.5%, lease operating expense = $5,000 per month, price of oil = $15/STB, price of associated gas = $2.25/Mscf, GOR = 500 scf/STB, oil and gas severance taxes = 7.085%. ..
Fixed expenses consist of $299,900 of common costs allocated to the three products based on relative sales, and additional fixed expenses of $29,700 (Tingler), $79,500 (Shocker), and $34,300 (Stunner).
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The sales mix in units for the period is 70% for A and 30 % for B. If the unit contribution margin for A is $8.78 and the unit contribution margin for B is $5.24, then the weighted-average unit contribution margin is
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