Question 9: The most recent financial statements for Crosby, Inc. follow. Sales for 2021 are projected to grow by 20%. Interest expense will remain constant; the tax rate and the dividend payout ratio will also remain constant. Costs, other expenses, current assets, fixed assets, and accounts payable increase proportional to sales. If the firm does not issue new debt or new equity, what external financing is needed to support the 20% growth rate in sales? Sales Costs Other expenses EBIT Interest expense Taxable income Taxes (21%) Net income Crosby Inc, Income Statement Dividends Addition to RE Assets Current Assets Cash Accounts receivables Inventory Total Fixed Assets Total Assets Net plant and equipment $686,530 $554,420 $14,020 $118,090 $12,090 $106,000 $22,260 $83,740 $27,475 $56,265 Crosby Inc, Balance Sheet as of December 31, 2020 $20,940 $31,970 $71,320 $124,230 $341,980 $466,210 Liabilities and Owners' Equity Current Liabilities Accounts Payable Notes Payable Total Long-Term Debt Owners' Equity Common Stock Retained Earnings Total Total Liabilities and Owners' Equity $53,790 $13,215 $67,005 $127,500 $105,000 $166,705 $271,705 $466,210

Question 9: The most recent financial statements for Crosby, Inc. follow. Sales for 2021 are projected to grow by 20%. Interest expense will remain constant; the tax rate and the dividend payout ratio will also remain constant. Costs, other expenses, current assets, fixed assets, and accounts payable increase proportional to sales. If the firm does not issue new debt or new equity, what external financing is needed to support the 20% growth rate in sales