INCOME STATEMENT
Sales $50,000
Costs 38,000
Taxable Income $12,000
Taxes (34%) 4,080
Net Income $7,920
BALANCE SHEET
Current Assets $24,000
Fixed Assets $91,000
Total $115,000
Long-term Debt $54,500
Equity $60,500
Total $115,000
Assets and costs are proportional to sales. The company maintains a constant 40 percent dividend payout ratio and a constant debt-equity ratio.
What is the maximum increase in sales that can be sustained assuming no new equity is issued? (Do not round intermediate calculations and round your final answer to 2 decimal places (e.g., 32.16).)