Can you help me with questions 8 & 9 please? Thank you!

CASE 11 TIPTON ICE CREAM FINANCIAL FORECASTING George Tipton began the Tipton Ice Cream Company nearly five decades ago. He patented a soft ice cream and right from the outset paid special attention to quality. "We only make one product, but we make it in many flavors and we make it well," Tipton was fond of saying. The company was an immediate suc- cess and sales quickly reached seven figures DEBT AVERSION The firm expects strong growth in the coming year (1996) and Brenda Hood, Tipton's chief financial officer, hopes she can make a strong case for borrowing to finance the company's expansion. She realizes, however, that she is likely to face stiff opposition from the Tipton family. George Tipton, perhaps unduly influenced by the Great Depression of the 1930s, detested borrowing money and his motto was "Never a lender nor borrower be." For nearly 25 years all the company's stock was owned by the Tipton family, but due to expansion new shares have been sold during the last 15 years to individuals outside the family. By 1995 the Tpton family owns 60 percent of all shares, and although the family has not been very active in running the firm, it does insist on one family tradition: "Never a lender nor borrower be." To this day Tipton has never owed anything beyond its accounts payable and accruals. Hood knows this is an extreme case of debt aversion and the policy has hurt the owners' profits. For example, historically Tipton has been slightly above the industry average in return on total assets but consistently below in return on owner's equity. At each annual meeting she has tried unsuccessfully to con- vince the Tipton clan to use more debt. And each year Hood heard a chorus of "Never a lender...." But perhaps this year would be different. She recalls two sessions on financial management that she held for the non- financial executives of Tipton. Some members of the Tipton family had CASE 11 TIPTON ICE CREAM FINANCIAL FORECASTING George Tipton began the Tipton Ice Cream Company nearly five decades ago. He patented a soft ice cream and right from the outset paid special attention to quality. "We only make one product, but we make it in many flavors and we make it well," Tipton was fond of saying. The company was an immediate suc- cess and sales quickly reached seven figures DEBT AVERSION The firm expects strong growth in the coming year (1996) and Brenda Hood, Tipton's chief financial officer, hopes she can make a strong case for borrowing to finance the company's expansion. She realizes, however, that she is likely to face stiff opposition from the Tipton family. George Tipton, perhaps unduly influenced by the Great Depression of the 1930s, detested borrowing money and his motto was "Never a lender nor borrower be." For nearly 25 years all the company's stock was owned by the Tipton family, but due to expansion new shares have been sold during the last 15 years to individuals outside the family. By 1995 the Tpton family owns 60 percent of all shares, and although the family has not been very active in running the firm, it does insist on one family tradition: "Never a lender nor borrower be." To this day Tipton has never owed anything beyond its accounts payable and accruals. Hood knows this is an extreme case of debt aversion and the policy has hurt the owners' profits. For example, historically Tipton has been slightly above the industry average in return on total assets but consistently below in return on owner's equity. At each annual meeting she has tried unsuccessfully to con- vince the Tipton clan to use more debt. And each year Hood heard a chorus of "Never a lender...." But perhaps this year would be different. She recalls two sessions on financial management that she held for the non- financial executives of Tipton. Some members of the Tipton family had