Financial Accounting

Feb 9th, 2015
Business Finance
Price: $10 USD

Question description

hw.jpg Cash Flow Franklin Co., a specialty retailer, has a history of paying quarterly dividends of $0.50 per share. Management is trying to determine whether the company will have adequate cash on December 31, 2015, to pay a dividend if one is declared by the board of directors. The following additional information is available: All sales are on account, and accounts receivable are collected one month after the sale. Sales volume has been increasing 5% each month. All purchases of merchandise are on account, and accounts payable are paid one month after the purchase. Cost of sales is 40% of the sales price. Inventory levels are maintained at $75,000. Operating expenses in addition to the mortgage are paid in cash. They amount to $3,000 per month and are paid as they are incurred. Required: Determine the cash that Franklin will have available to pay a dividend on December 31, 2015. Round intermediate calculations and final answer to the nearest dollar.

Tutor Answer

(Top Tutor) khakaan
School: Rice University

Studypool has helped 1,244,100 students

Review from student
" Top quality work from this guy! I'll be back! "
Ask your homework questions. Receive quality answers!

Type your question here (or upload an image)

1824 tutors are online

Brown University

1271 Tutors

California Institute of Technology

2131 Tutors

Carnegie Mellon University

982 Tutors

Columbia University

1256 Tutors

Dartmouth University

2113 Tutors

Emory University

2279 Tutors

Harvard University

599 Tutors

Massachusetts Institute of Technology

2319 Tutors

New York University

1645 Tutors

Notre Dam University

1911 Tutors

Oklahoma University

2122 Tutors

Pennsylvania State University

932 Tutors

Princeton University

1211 Tutors

Stanford University

983 Tutors

University of California

1282 Tutors

Oxford University

123 Tutors

Yale University

2325 Tutors