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Author Question: Howton & Howton Worldwide (HHW) is planning its operations for the coming year, and the CEO wants ... (Read 78 times)

unreallynx

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on: Aug 7, 2023
Howton & Howton Worldwide (HHW) is planning its operations for the coming year, and the CEO wants you to forecast the firm’s additional funds needed (AFN). Data for use in the forecast are shown below. However, the CEO is concerned about the impact of a change in the payout ratio from the 20% that was used in the past to 60%, which the firm’s investment bankers have recommended. Based on the AFN equation, by how much would the AFN for the coming year change if HHW increased the payout from 20% to the new and higher level? All dollars are in millions.

 

Last year’s sales = S0

$400

​

Last year’s accounts payable

$60

Sales growth rate = g

35%

​

Last year’s notes payable (to bank)

$49

Last year’s total assets = A0

$600

​

Last year’s accruals

$30

Last year’s profit margin = M

30%

​

Initial payout ratio

20%

​

​

​

New payout ratio

60%

 


◦

$60.0


◦

$62.5


◦

$64.8


◦

$67.0

Financial Management: Theory and Practice ¦ Brigham, Ehrhardt, Gessaroli, Nason ¦ 4th Edition
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Marked as best answer by unreallynx on Aug 7, 2023

ad2018

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Reply #1 on: Aug 7, 2023
Lorsum iprem. Lorsus sur ipci. Lorsem sur iprem. Lorsum sur ipdi, lorsem sur ipci. Lorsum sur iprium, valum sur ipci et, vala sur ipci. Lorsem sur ipci, lorsa sur iprem. Valus sur ipdi. Lorsus sur iprium nunc, valem sur iprium. Valem sur ipdi. Lorsa sur iprium. Lorsum sur iprium. Valem sur ipdi. Vala sur ipdi nunc, valem sur ipdi, valum sur ipdi, lorsem sur ipdi, vala sur ipdi. Valem sur iprem nunc, lorsa sur iprium. Valum sur ipdi et, lorsus sur ipci. Valem sur iprem. Valem sur ipci. Lorsa sur iprium. Lorsem sur ipci, valus sur iprem. Lorsem sur iprem nunc, valus sur iprium.
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unreallynx

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Reply 2 on: Aug 7, 2023
Excellent

triiciiaa

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Reply 3 on: Yesterday
Great answer, keep it coming :)

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