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Owens Electronics has nine operating plants in seven southwestern states. Sales for last year were $100 million, and the balance sheet at year-end is similar

Owens Electronics has nine operating plants in seven southwestern states. Sales for last year were $100 million, and the balance sheet at year-end is similar in percentage of sales to that of previous years (and this will continue in the future). All assets (including fixed assets) and current liabilities will vary directly with sales. The firm is working at full capacity.

Balance Sheet (in $ millions)
Assets Liabilities and Stockholders' Equity
Cash $ 12 Accounts payable $ 22
Accounts receivable 27 Accrued wages 9
Inventory 28 Accrued taxes 11
Current assets $ 67 Current liabilities $ 42
Fixed assets 45 Notes payable 16
Common stock 19
Retained earnings 35
Total assets $ 112 Total liabilities and stockholders' equity $ 112

Owens has an aftertax profit margin of 9 percent and a dividend payout ratio of 40 percent.

If sales grow by 30 percent next year, determine how many dollars of new funds are needed to finance the growth.

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