Antivirus Inc. expects its sales next year to be $2,600,000. Inventory and accounts receivable will increase...
Homework Answers
Net income = Sales * Profit margin = $2,600,000 * 0.20 = $520,000
Increase in retained earnings = Net income - Dividends = $520,000 - ($520,000 * 0.40) = $312,000
External funds needed = Increase in assets - Increase in retained earnings
External funds needed = $490,000 - $312,000
External funds needed = $178,000
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Antivirus Inc. expects its sales next year to be $2,600,000.
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