My company has sales of 500,000 dollars. A/R rate of 90,000 dollars. With a profit margin of 12% with a 40% dividend payout, how much external financing will I need? Please tell me how to solve this problem.
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My company has sales of 500,000 dollars. A/R rate of 90,000 dollars. With a profit margin of 12% with a 40% dividend payout, how much external financing will I need? Please tell me how to solve this problem.
Account receivables = 90000
less profit retained
500000 x .12(1-.4) = -36000
Net financing required = 54000
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