Pierce furnishings generated 2 million in sales during 2008


Pierce furnishings generated $2 million in sales during 2008, and its year-end total assets were $1.5 million. Also, at year-end 2008, current liabilities were $500,000, consisting of $200,000 of notes payable, $200,000 of accounts payable, and $100,000 of accrued liabilities. Looking ahead to 2009, the company estimates that its assets must increase by $.75 for every $1.00 increase in sales. Pierces profit margin is 5%, and its payout ratio is 40%. How large a sales increase can the company achieve without having to raise funds externally?

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Financial Management: Pierce furnishings generated 2 million in sales during 2008
Reference No:- TGS01371860

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