Goldilochs Inc

question 75

Multiple Choice

Goldilochs Inc. reported sales of $8 million and net income of $1.5 million. The firm has $10.5 million in total assets. The firm's chief financial officer is projecting a 20 percent increase in sales. If the firm's sales do increase by 20 percent, it is expected that spontaneous liabilities will increase by $500,000. The firm currently pays out 30 percent of its net income to shareholders. Assuming that all assets are expected to grow with sales, how much in additional funds will Goldilochs need from external sources to fund the expected growth?

• A) $340,000
• B) $299,000
• C) $321,000
• D) $360,000

Understand the concept and components of a sales budget.

Comprehend the calculations involved in production budgeting, including inventory planning.

Identify and explain various types of budgets within a master budget, including capital expenditures and operating budgets.

Calculate budgeted sales based on units and prices and understand the influence of growth rates on future sales.

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