Pharma Biotech Corporation (Continued) PHARMA BIOTECH CORPORATION BALANCE SHEET AS OF DECEMBER 31, 2016 (THOUSANDS OF DOLLARS) Part A Cash and marketable securities $ 1,000 Accounts payable $ 1,600 Accounts receivable 2,000 Bank loan 1,800 Inventories 2,200 Accrued liabilities 1,200 Total current assets 5,200 Total current liabilities 4,600 Long-term debt 2,200 Common stock 2,400 Fixed assets, net Total assets 6,800 $12,000 Retained earnings 2,800 Total liabilities and equity $12,000 Pharma Biotech is interested in developing an initial "big picture" of the size of financing that might be needed to sup- port its rapid growth objectives for 2017 and 2018. A. Calculate the following financial ratios (as covered in Chapter 5) for Pharma Biotech for 2016: (a) net profit margin, (b) sales-to-total-assets ratio, (c) equity multiplier, and (d) total-debt-to-total-assets. Apply the return on assets and return on equity models. Discuss your observations. B. Estimate Pharma's sustainable sales growth rate based on its 2016 financial statements. [Hint: You need to estimate the beginning of period stockholders' equity based on the information provided.] What financial policy change might Pharma Biotech make to improve its sustainable growth rate? Show your calculations. C. Estimate the additional funds needed (AFN) for 2017, using the formula or equation method presented in the chapter. D. Also, estimate the AFN using the equation method for Pharma Biotech for 2018. What will be the cumulative AFN for the two-year period