Klock Manufacturing has the following abbreviated financial statements for the year ending today.

Assets

$$120,000,000$

Operating liabilities

$$15,000,000$

Short$-$term debt

$$10,000,000$

Long$-$term debt

$$50,000,000$

Equity

$$45,000,000$

Liabilities $+$ equity

$$120,000,000$

Revenue

$$140,000,000$

$-$Operating expenses

$($$$115,000,000)$

EBIT

$$25,000,000$

$-$Interest

$($$$3,500,000)$

$-$Taxes

$($$$6,000,000)$

Net income

$$15,500,000$

Suppose that Klock forecasts an $13\%$ increase in its revenue for the coming year. $($a$)$ Suppose that $($i$)$ the levels of assets, operating liabilities, and long$-$term debt will change in response to the change in revenue, $($ii$)$ the firm intends to have a payout rate of $60\%,$ and $($iii$)$ the asset turnover ratio, the profit margin, and the level of short$-$term debt are expected to be constant. $(25$ points$)$

$1.)$ What will the external funds needed be based on these assumptions? $($Hint: use the equation and do not forecast entire new statements.$)$ Type your answer for EFN $($you can email me an image of your work.$)$

$2.)$ What does this number tell you?