A Firm Has the Following Statement of Financial Position

question 11

Multiple Choice

A firm has the following statement of financial position: Fixed assets are being used at 80 percent of capacity; sales for the year just ended were R200; sales will increase R10 per year for the next 4 years; the profit margin is 5 percent; and the dividend payout ratio is 60 percent.Assume that fixed assets cannot be sold.What are the total external financing requirements for the entire 4 years, i.e., the total AFN for the 4-year period?

• A) R4.00
• B) R2.00
• C) -R0.80 (Surplus)
• D) -R14.00 (Surplus)
• E) R0

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Definitions:

Prune Paste

A protective coating applied to trees after pruning to seal cuts and prevent disease.

External Suppliers

Businesses or individuals that provide products or services to another company but are not part of the company's internal structure.

Performance Measures

Quantitative indicators used to assess how well an organization or individual is achieving its goals and objectives.

Incentives

Rewards or compensations offered to encourage specific behaviors or actions, often used to motivate employees or customers.