Suppose That Runner Industries Currently Has the Balance Sheet Shown

question 72

Multiple Choice

Suppose that Runner Industries currently has the balance sheet shown as follows,and that sales for the year just ended were $5 million.The firm also has a profit margin of 10 percent,a retention ratio of 20 percent,and expects sales of $7 million next year.If fixed assets have enough capacity to cover the increase in sales and all other assets and current liabilities are expected to increase with sales,what amount of additional funds will the company need from external sources to fund the expected growth?

• A)$0
• B)$140,000
• C)$220,000
• D)$180,000

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Definitions:

Relationships

Connections or associations between two or more people, entities, or concepts, often characterized by mutual interactions and emotional bonds.

Linear Perspective

A technique in visual art and photography that creates the illusion of depth and distance using converging parallel lines.

Distance Cue

Visual indicators that help the observer judge the distance of objects, including factors like texture gradient, overlap, and linear perspective.

Parallel Rows

Lines of objects or elements that are positioned side by side at a constant distance from each other and do not intersect.