A company wants to reinvest 60% of their $60,000 profit for the year in their business and use the rest to pay down the principal on its loan and dividends to their common shareholders, the company expects to invest 70% of their retained earnings in non-current assets and 30%in working capital. The company revenue is $600,000.
On the basic of this information, calculate how much managers would keep in their businessfor growth reasons and how much would be used to pay off their loan and the amount that would be invested in non-current assets and in working capital.
retained earnings $_______
Loan and dividends $_________
Non-current assets $__________
Working capital $________________