17. Snowball & Company has the following balance sheet: * Current assets $7,000 AP & accrued liabilities $ 1.500 Fixed assets 3,000 S-T (3-month) loans 2,000 Common stock 1 500 Retained earnings 5.000 Total liabilities Total assets $10,000 and equity $10.000 Snowball's profit margin is 11 percent, and the company pays out 60 percent of ts eamings as dividends. Its sales last year were $10,000; its assets were used to full capacity. The company uses the AFN formula to estimate funds requirements, and it plans to raise any required extemal capital as short-term bank loans. If sales grow by 50 percent, then the additional fund needed is: a. $ 3,260 O b. $ 3,590 O c. $ 2,590 O d. $ 2,260 O e. $5,090 18. Whitman Antique Cars Inc. has the following data, and it follows the residual dividend policy. Some Whitman family members would like more dividends, and they also think that the firm's capital budget includes too many projects whose NPVs are close to zero. If Whitman reduced its capital budget to the indicated level, by how much could dividends be increased, holding other things constant? Original capital budget New capital budget Net income % Debt $3,000,000 $2,000,000 $3,500,000 40% a. $486,000 b. $540,000 c. $600,000 d. $660,000 e. $726,000