Johnson company is expected to increase sales from $6,000,000 to $8,000,000. Total assets will be $3,000,000 at the end of the year.
Assumming that Johnson company is already at full capacity, it will need to grow its assets at the same rate as its projected sales. Current liabilities were $1,500,000 consisting of $1,000,000 of notes payable, $250,000 of accounts payable, and $250,00 of accruals.
After tax profit Margin is forecasted to be 3.5%, and forecasted payout ratio is 50%.
Calculate the following Capital Intensity Ratio, Spontaneous liabilities to sales ratio, expected Net Income over one year from now, dividend payments in the following year and External funds needed.