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I need the answer to #2. Thank you! SES AIR, INC. 2018 income Statement $46,298,115 Sales Cost of goods sold 34,536,913 Other expenses 5,870,865 2,074,853

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I need the answer to #2. Thank you!

SES AIR, INC. 2018 income Statement $46,298,115 Sales Cost of goods sold 34,536,913 Other expenses 5,870,865 2,074,853 Depreciation $3,815,484 EBIT Interest 725,098 3,090,386 Taxable income 772,597 Taxes (21%) $ 2,317,789 Net income $ 705,000 Dividends 1,612,789 Add to retained earnings SES AIR, INC. 2018 Balance Sheet Liabilities and Equity Assets Current liabilities Current assets 1,068,356 Cash $ 524,963 Accounts payable Notes payable 2,439,553 843,094 Accounts recelvable $ 3,507,909 Inventory Total current liabilities 1,235,161 2,603,218 $6,300,000 Long-term debt Total current assets Fixed assets $20,381,945 Sharehoider equity Net plant and equipment Common stock 460,000 Retained earnings Total equlty 12,717,254 $13,177,254 $22,985,163 $22,985,163 Total liabilitles and equity Total assets QUESTIONS fixed assets must be increased in specific amounts because it is impossible, as a practical matter, to buy part of a new plant or machine. In this case, a company has a "staircase" or "lumpy" fixed cost structure. Assume S&S Air is cur rently producing at 100 percent capacity. As a result, to increase production, the company must set up an entirely new line at a cost of $5,000,000. Calculate the new EFN with this assumption. What does this imply about capacity utilization for the company next year? 1. Calculate the internal growth rate and sustainable growth rate for S&S Air. What do these numbers mean? 2. S&S Air is planning for a growth rate of 12 percent next year. Calculate the EFN for the company assuming the company is operating at full capacity. Can the company's sales increase at this growth rate? 3. Most assets can be increased as a percentage of sales. For instance, cash can be increased by any amount. However

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