Assume now that equity accounts do not vary directly with sales but change when retained earnings change or new equity is issued. The company pays 85 per cent of its profit as dividends every year. In addition, the company plans to expand production capacity by acquiring additional equipment. This will cost the company $12 million. The company has no plans to issue new equity this year. Prepare a pro forma balance sheet using this information. Any funds that need to be raised (in addition to changes in current liabilities) will be in the form of long-term debt.

Based on the information in part (b), calculate: i. the External Financing Needed ii. the Internal Growth Rate iii. the Sustainable Growth Rate

		balance sheet
assests				liability
cash	4186548			account payable	11302098
account receivable	7288442			bank overdraf	6071870
inventories	27834593			total current liability	17373968
total current assets	39309583			10 year corporate bond	37164258
equipment	54203102			ordinary shares	24984375
buildings	1530293			retained earning	16176217
intangible assets	655840			total liability and equity	95698818
total assets	95698818
	income statement
revenues	241515625
costs	181582031
EBITDA	59933594
Depreciation	29148438
EBIT	30785156
interest	14919836
EBT	15865320
Tax 30%	4759596
Profit	11105724