Small Motors Inc, which is currently operating at full capacity, has sales of $2

Question

Small Motors Inc, which is currently operating at full capacity, has sales of $29,000, current assets of $1,600, current liabilities of $1,200, net fixed assets of $27,500, and a 5 percent profit margin. The firm has no long-term debt and does not plan on acquiring any. The firm does not pay any dividends. Sales are expected to increase by 6.5 percent next year. If all assets, short-term liabilities, and costs vary directly with sales, answer the following questions? Hint: (Additional Financing Required = Projected assets

Explanation / Answer

Projected assets = ($1,600 + $27,500)

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