Question 5. (20 marks) The most recent financial statements for Fleury, Inc., follow. Sales for 2012 are projected to grow by 20 percent. Interest expense will remain constant; the tax rate and the dividend payout rate will also remain constant. Costs, other expenses, current assets, fixed assets, and accounts payable increase spontaneously with sales. If the firm is operating at full capacity and no new debt or equity is issued, what external financing is needed to support the 20 percent growth rate in sales? Heury Inc 2011 Income Statement Sales 743,000 Costs 578,000 Other expenses 15,200 Earning before interest and taxes 149,800 Interest paid 11,200 Taxable income 138,600 Taxes 48,510 Net Income 90,090 Dividends 27,027 Additions to retained earnings 63,063 I Amount Assets Current Assets Cash Accounts receivables Inventory Total Heury Inc. Balance sheet as of December 31, 2011 Amount Liabilities Current liabilities 20,240 Accounts payable 32,560 Notes payable 69,520 Total 122,320 54,400 13,600 68,000 Long term debt 126,000 Fixed Assets Net plant and equipment 330,400 1 Owner's equity Common stock and paid-in surplus Retained earnings Total 112,000 146,720 258,720 452,720 Total liabilities and shareholder's equity 452,720 Total assets