In 2019 financial statements of Growth Industries are presented below. Sales and costs are projected to grow at 20% a year for the next 4 years. Both current assets and accounts payable are projected to rise in proportion to sales. The firm is currently operating at full capacity, so it plans to increase fixed assets in proportion to sales. Interest expense will equal 10% of LT debt outstanding at the start of the year. The firm will maintain a dividend payout ratio of .40. Construct a spreadsheet model for Growth industries similar to the one in Spreadsheet 18.1

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In 2019 financial statements of Growth Industries are presented below. Sales and costs are projected to grow at 20% a year for the next 4 years. Both current assets and accounts payable are projected to rise in proportion to sales. The firm is currently operating at full capacity, so it plans to increase fixed assets in proportion to sales. Interest expense will equal 10% of LT debt outstanding at the start of the year. The firm will maintain a dividend payout ratio of 40. Construct a spreadsheet model for Growth industries similar to the one in Spreadsheet 18.1. Income Statement Sales $200,000 Costs 150,000 EBIT $ 50,000 Interest expense 10,000 Taxable income $ 40,000 Taxes @21% 8,400 Net Income $ 31,600 Dividends $12,640 Additions to ret. Earnings $18,960 Balance Sheet Y/E 2019 Current assets Current liabilities Cash $3,000 A/P $10,000 A/R 8,000 Total current liabilities $10,000 Inventories 29,000 LT debt 100,000 Total current assets 40,000 S/E plus APIC 15,000 Net plant & equipment 160,000 Retained earnings 75,000 Total assets $200,000 Total liabilities & S/E $200,000 1. How much external capital will the company require in 2023? 2. What will be the company's debt ratio at the end of 2023