Suppose that Wind Em Corp. currently has the balance sheet shown below, and that sales for the year just ended were $15 million. The firm also has a profit margin of 23 percent, a retention ratio of 40 percent, and expects sales of $20 million next year. If all assets and current liabilities are expected to grow with sales, what is the necessary increase in assets?
A) $240,000
B) $3,333,333.33
C) $1,366,957.14
D) $1,840,000

Question

Suppose that Wind Em Corp. currently has the balance sheet shown below, and that sales for the year just ended were $15 million. The firm also has a profit margin of 23 percent, a retention ratio of 40 percent, and expects sales of $20 million next year. If all assets and current liabilities are expected to grow with sales, what is the necessary increase in assets? 
A) $240,000 
B) $3,333,333.33 
C) $1,366,957.14 
D) $1,840,000

Quizplus · Accepted Answer

The Answer of Suppose that Wind Em Corp. currently has the balance sheet shown below, and that sales for the year just ended were $15 million. The firm also has a profit margin of 23 percent, a retention ratio of 40 percent, and expects sales of $20 million next year. If all assets and current liabilities are expected to grow with sales, what is the necessary increase in assets? 
A) $240,000 
B) $3,333,333.33 
C) $1,366,957.14 
D) $1,840,000

Suppose That Wind Em Corp