1. Goldilochs Inc. reported sales of $8 million and net income of $1.5 million. The firm has $10.5 million in total assets. The firm's chief financial officer is projecting a 20 percent increase in sales. If the firm's sales do increase by 20 percent, it is expected that spontaneous liabilities will increase by $500,000. The firm currently pays out 30 percent of its net income to shareholders. Assuming that all assets are expected to grow with sales, how much in additional funds will Goldilochs need from external sources to fund the expected growth?

2. Which of the following defines the term deseasonalize?

• To fix asset growth to smooth out the seasonality of sales growth

• To use pro forma statements to determine future years' forecasts

• To remove the effects of seasonality from historic data

• To remove fixed asset growth that does not tie into sales growth