Mzansi Magic Ltd has the following balance sheet and income statement. Please use the financial statement to answer the following questions.

Mzansi Magic Ltd.

2019 Income Statement

Net sales R10 300

Less: Cost of goods sold 7 400

Less: Depreciation 1 500

PBIT 1 400

Less: Interest paid 340

PBT R 1 060

Less: Taxes 371

NPAT R 689

Dividends R310,05

Addition to retained profits R378,95

Mzansi Magic Ltd.

2019 Balance Sheet

Ordinary shares

R5 300

Net non-current assets

R12 360

Retained profits

3 770

Inventory

930

Accounts payable

1 010

Accounts receivable

750

Long-term debt

4 800

Cash

840

Total equity and liabilities

R14 880

Total assets

R14 880

All costs and net working capital vary directly with sales. Sales are projected to increase by 7 per cent. What is the projected increase in accounts payable? (1 mark)

The profit margin, the debt-equity ratio, and the dividend payout ratio are constant. Sales are expected to increase by R875,50 next year. What is the projected addition to retained profits for next year? (1 mark)

Assume that Mzansi Magic Ltd. is operating at full capacity. Also assume that all costs, net working capital, and non-current assets vary directly with sales. The debt-equity ratio and the dividend payout ratio are constant. What is the projected increase in total assets if sales are projected to increase by 12 per cent? (1 mark)

Assume that Mzansi Magic Ltd. is operating at full capacity. Also assume that assets and costs vary directly with sales but liabilities do not. The dividend payout ratio is constant. What is the external financing need if sales increase by 8 per cent? (2 marks)

Mzansi Magic Ltd. is projecting sales to increase by 5 per cent next year and the profit margin to remain constant. The firm wants to increase the dividend payout ratio by 10 per cent. What is the amount of the projected addition to retained profits for next year? (2 marks)

What is the internal growth rate of Mzansi Magic Ltd. if the dividend payout ratio remains constant? (2 marks)