16-1 Midwest Mining (MWM) expects its sales to grow by 25 percent next year. Last year, when the firm was operating at full capacity, MWM generated sales equal to $250,000 with assets of $800,000. MWMs current balance sheet shows the accounts payable and accruals are $150,000, notes payable are $25,000, long-term debt is $100,000, common stock is $450,000, and retained earnings are $75,000. Next year, MWMs net profit margin is expected to be he same as this past year, 6 percent, and the company plans to continue to pay 60 percent of earnings as dividends. Estimate MWMs additional funds needed (AFN) for the next year.

16-2 In its most recent fiscal year, SynoCorp generated $810,000 in sales. The firm was operating at 80 percent of capacity. How much more sales can SynoCorp generate before it is at full capacity?

16-3 Prime Colors (PC) sell one-gallon cans of house paint for $25 each. The variable cost to produce each can is $17.50 and fixed operating costs are $180,000. PC normally sells 30,000 gallons of paint each year, has an interest expense equal to $300, and its marginal tax rate is 40 percent. Given this information, what is PCs operating breakeven point (a) in terms of sales dollars and (b) In terms of the number of one-gallon paint cans sold?

16-4 Mercury Airs debt consists of $50,000 in accounts payable, $100,000 of 10 percent notes payable, and $240,000 in 9 percent bonds. Mercury has no preferred stock. If its marginal tax rate is 35 percent, what is Mercurys financial breakeven point?