Intro

Mickey Inc. is about to open a new amusement park and expects sales to grow by 50% next year. The income statement and balance sheet for the previous year are given below (in $ million):

Line item	Previous
Sales	125
Operating costs	87.5
Depreciation	25
EBIT	12.5
Interest	5
Taxes	2.625
Net income	4.875
- Dividends	1.95
- Addition to retained earnings	2.925

Interest expenses and the tax rate and payout ratio will stay the same.

Assets			Liabilities and Equity
Cash	16		Accounts payable	21
Accounts receivable	8.6		Accrued wages	12
Inventory	19		Notes payable	2.8
Current assets	43.6		Current liabilities	35.8
Machines	34		Long-term debt	48
Real estate	21		Total liabilities	83.8
Fixed assets	55		Total equity	14.8
Total assets	98.6		Liabilities & equity	98.6

Accounts payable and accrued wages are expected to increase at the same rate as sales. Assets would grow at the same rate if the company operated at full capacity, but capacity utilization was only 89% last year.

Part 1

What are projected assets for next year (in $ million)?

Part 2

What are projected current liabilities (in $ million)?

Part 3

What is projected equity for next year (in $ million)?

Part 4

What is the external funding required (EFR) for next year (in $ million)?