Urban's, Which Is Currently Operating at Full Capacity, Has Sales

question 61

Multiple Choice

Urban's, which is currently operating at full capacity, has sales of $47,000, current assets of $5,100, current liabilities of $6,200, net fixed assets of $51,500, and a profit margin of 5 percent. 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 3 percent next year. If all assets, short-term liabilities, and costs vary directly with sales, how much additional equity financing is required for next year?

• A) −$908.50
• B) −$722.50
• C) $967.30
• D) $1,698.00
• E) $1,512.00

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Definitions:

Sensory Neuron

A type of neuron that transmits signals from sensory receptors towards the central nervous system.

Stretch Receptors

Sensory receptors that detect changes in muscle length, contributing to the sense of muscle position and movement.

Biceps Brachii

An upper arm muscle responsible for bending the elbow and twisting the forearm.

Muscle And Tendon

Components of the musculoskeletal system where muscle tissue connects to bones through tendons, facilitating movement.