Business, 10.08.2021 02:30 astultz309459

Fuzzy Button Clothing Company reported sales of $720,000 at the end of last year; but this year, sales are expected to grow 8%. Fuzzy Button Clothing Company expects to maintain its current profit margin of 22% and dividend payout ratio of 30%. The firm's total assets equaled $475,000 and were operated at full capacity. Fuzzy Button Clothing Company's balance sheet shows the following current liabilities: accounts payable of $75,000, notes payable of $25,000, and accrued liabilities of $75,000. Based on the AFN (Additional Funds Needed) equation, what is the firm's AFN for the coming year? a. -$121,875.
b. -$93,750.
c. -$84,375.
d. -$98,438.
Because of its excess funds, Fuzzy Button Clothing Company is thinking about raising its dividend payout ratio to satisfy shareholders. Fuzzy Button could pay out of its earnings to shareholders without needing to raise any external capital. (Hint: What can Fuzzy Button increase its dividend payout ratio to before the AFN becomes positive?)
a. 59.4%.
b. 84.8%.
c. 80.6%.
d. 76.3%.

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Fuzzy Button Clothing Company reported sales of $720,000 at the end of last year; but this year, sal...

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