Carter Paint Company has plants in four provinces. Sales last year were $100 million, and the balance sheet at year-end is similar in percent of sales to that of previous years (and this will continue in the future). All assets and current liabilities will vary directly with sales. Assume the firm is already using capital assets at full capacity. Cash Accounts receivable Inventory Current assets Capital assets Total assets Assets (Click to select) (Click to select) (Click to select) Current assets $5 10 25 Assets 40 40 $ $80 $ Balance Sheet (in $ millions) Liabilities and Shareholders' Equity Accounts payable Accrued wages Accrued taxes The firm has an aftertax profit margin of 8 percent and a dividend payout ratio of 25 percent. a. If sales grow by 20 percent next year, determine how many dollars of new funds are needed to finance the expansion. (Do not round intermediate calculations. Enter the answer in millions. Round the final answer to 3 decimal places.) The firm needs $ million in external funds. Current liabilities. Long-term debt Common stock Retained earnings Total liabilities and shareholders' equity b. Prepare a pro forma balance sheet with any financing adjustment made to long-term debt. (Do not round intermediate calculations. Input all answers as positive values. Be sure to list the assets and liabilities in order of their liquidity. Enter the answers in millions. Round the final answers to 2 decimal places.) Balance Sheet ($ millions) Liabilities and Shareholders' Equity $ (Click to select) (Click to select) (Click to select) Current liabilities V $6 4 2 Next 12 15 20 33 $80 $

Carter Paint Company has plants in four provinces. Sales last year were $100 million, and the balance sheet at year-end is similar in percent of sales to that of previous years (and this will continue in the future). All assets and current liabilities will vary directly with sales. Assume the firm is already using capital assets at full capacity. The firm has an aftertax profit margin of 8 percent and a dividend payout ratio of 25 percent. a. If sales grow by 20 percent next year, determine how many dollars of new funds are needed to finance the expansion. (Do not round intermediate calculations. Enter the answer in millions. Round the final answer to 3 decimal places.) The firm needs $ (3) miltion in external funds. b. Prepare a pro forma balance sheet with any financing adjustment made to long-term debt. (Do not round intermediate calculations. Input all answers as positive values. Be sure to list the assets and liabilities in order of their liquidity. Enter the answers in millions. Round the final answers to 2 decimal places.) b. Prepare a pro forma balance sheet with any financing adjustment made to long-term debt. (Do not round intermediate calculations. Input all answers as positive values. Be sure to list the assets and liabilities in order of their liquidity. Enter the answers in millions. Round the final answers to 2 decimal places.) c. Calculate the current ratio and total debt to assets ratio for each year. (Do not round intermediate calculations. Round the fin answers to 1 decimal places.) Carter Point Company has plants in four provinces. Sales last year were $100 million, and the balance sheet at year-end is similar in percent of sales to that of previous years (and this will continue in the future). All assets and current liabilities will vary directly with sales. Assume the firm is already using capital assets at full capacity. The firm has an aftertax profit margin of 8 percent and a dividend payout ratio of 25 percent: a. If sales grow by 20 percent next year, determine how many doliars of new funds are needed to finance the expansion. (Do not round intermediate calculations. Enter the answer in millions. Round the final answer to 3 decimal places.) The firm needs \$ million in external funds. b. Prepare a pro forma balance sheet with any financing adjustment made to long-term debt. (Do not round intermediate calculations. Input all answers as positive values. Be sure to list the assets and liabilities in order of their liquidity. Enter the answers in miltions. Round the final answers to 2 decimal places.)