Cholesterol Dairy Products has plants in five provinces and operate a very large home delivery service. Sales late year were $100 million, and the balance sheet at year-end is similar in percentage 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.

Balance Sheet

(In $ Millions)

Assets

Cash $10

AR 14

Inventory 20

Current assets $44

Capital assets 44

Total assets $88

Liabilities and Shareholders Equity

Accounts Payable $4

Accrued wages 3

Accrued taxes 2

Current liabilities $9

Long-ter debt 25

Common Stock 30

Retained earnings 24

Total Liabilities and Shareholders equity

$88

The firm has an after-tax profit margin of 3 percent and a dividend payout ratio of 30 percent

1a. IF sales grow by 20 percent next year, determine how many dollars of new fund required (RNF) are needed to finance the expansion. (Round the final answer to 2 decimal places)

1b. Prepare a pro forma balance sheet with any financing adjust made to long term debt. (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 answer to 3 decimal places.)

1c.Calculate the current ratio and total debt to assets ration for each year. (Round the final answer to 3 decimal places.)