Need solution for B only.

b. based on your initial projections, how much external financing (long-term debt and/or stockholders' equity) will Merck need to fund its growth at projected increases in sales?

Comparative income statements and balance sheets for Merck (S millions) follow: Income Statement Net sales... Cost of goods.. Gross profit. Selling, general and administrative expense. Depreciation and amortization expense. Interest expense. Income before tax... Income tax expense. Net income.... Outstanding shares... Balance Sheet Cash.. Receivables... Inventories. Other current assets.. Total current assets... Property, plant, and equipment. Accumulated depreciation.. Net property, plant, and equipment. Other noncurrent assets. Total assets.... Accounts payable and accrued liabilities. Short-term debt and current maturities of long-term debt... Income taxes payable. Total current liabilities... Deferred income taxes and other liabilities Long-term debt..... Total noncurrent liabilities.. Comman stock... Capital surplus Retained earnings.. Treasury stock.... Shareholders' equity... Total liabilities and equity. Year 2 Interest expense/Prior-year long-term debt. Income ta Income tax expense/Pretax income. Accounts meer Accounts receivable turnover (Sales/Accounts receivable) $47,716 28,977 18,739 6,531 1,464 342 Dividends per share. Capital expenditures/Sales..... 10,402 3.121 .$ 7,282 2,976 $ 3,287 5,215 3,579 880 12,961 18,956 5,853 13,103 17,942 $44,006 $5,904 4,067 1.573 11.544 Year 2 11,614 4,799 16,413 Sales growth... Gross profit margin. Selling, general, and administrative expense/Sales. Depreciation expense/Prior-year property, plant & equipment (grass). Year 1 testu Inventory turnover (Cost of goods sold/Inventory) Accounts payable turnover (Cost of goods sold/Accounts payable). Taxes payable/Tax expense... Total assets/Stockholders' equity (financial leverage). $40,343 22,444 17,899 6,469 1,277 329 9.824 3,002 $6,822 2,968 $ 4,255 5,262 3,022 1,059 13,598 16,707 5,225 11,482 15,075 $40,155 $ 5,391 3,319 1,244 9,954 Required: a. Use the following ratios to prepare a projected income statement, balance sheet, and statement f cash flows for Year 3. Year 1 30 30 6,907 6,266 31,500 27,395 (22,387) (18,858) 16,050 14,833 $44,007 $40,154 11,768 3,601 15,369 18.27% 39.27% 13.69% 8.76% 4.94% 30.00% 015 9.15 636 8.10 4.91 50.41% 2.35 $1.06 9.04% b. Based on your initial projections, how much external financing (long-term debt and/or stockholders' equity) will Merck need to fund its growth at projected increases in sales