Calculate the Internal Growth Rate and the Sustainable Growth Rate. Show your calculations for ROE, ROA, plowback ratio, Net Income and Additions to Retained Earnings.

2. Calculate the External Financing Needed ("EFN") for the company. Recall the particular account balances which i stressed in class do not vary with sales. You will need this hint to properly balance the Balance Sheet for this question.

3. Prepare the pro forma balance sheet and income statement

S&S AIR, INC. 2014 Income Statement Sales Cost of goods sold Other expenses Depreciation EBIT Interest Taxable income Taxes (40%) Net income Dividends $ 610,000 Add to retained earnings 1,419,766 $40,259,230 29,336,446 5,105,100 1,804,220 $ 4,013,464 630,520 $ 3,382,944 1,353,178 $ 2,029,766 Assets Current assets Cash Accounts receivable Inventory Total current assets Fixed assets Net plant and equipment S&S AIR, INC. 2014 Balance Sheet Liabilities and Equity Current liabilities $ 456,435 Accounts payable $ 929,005 733,125 Notes payable 2,121,350 1,073,180 Total current liabilities $ 3,050,355 $ 2,262,740 Long-term debt $ 5,500,000 $17,723,430 Shareholder equity Common stock Retained earnings Total equity Total liabilities and equity $ 400,000 11.035,815 $11,435,815 $19.986,170 Total assets $19.986.170 S&S AIR, INC. 2014 Income Statement Sales Cost of goods sold Other expenses Depreciation EBIT Interest Taxable income Taxes (40%) Net income Dividends $ 610,000 Add to retained earnings 1,419,766 $40,259,230 29,336,446 5,105,100 1,804,220 $ 4,013,464 630,520 $ 3,382,944 1,353,178 $ 2,029,766 Assets Current assets Cash Accounts receivable Inventory Total current assets Fixed assets Net plant and equipment S&S AIR, INC. 2014 Balance Sheet Liabilities and Equity Current liabilities $ 456,435 Accounts payable $ 929,005 733,125 Notes payable 2,121,350 1,073,180 Total current liabilities $ 3,050,355 $ 2,262,740 Long-term debt $ 5,500,000 $17,723,430 Shareholder equity Common stock Retained earnings Total equity Total liabilities and equity $ 400,000 11.035,815 $11,435,815 $19.986,170 Total assets $19.986.170