Questions #12 to # 15 are based on the following information. Pit Row Auto, a national auto parts chain, is considering purchasing a smaller chain, Southern Auto. Pit Row's analysts project that the merger will result in the following post merger data for Southern Auto (in millions of dollars, with a December 31 year-end) 2005 $450 45 2006 $518 53 2007 $555 60 2008 S600 68 Net Sales Selling and administrative expenses Interest 18 21 24 27 The cost of goods sold is expected to be 65 percent of sales in each year. If the acquisition is made, it will occur on January 1,2005. All cash flows shown in the income statements are assumed to occur at the end of the year. After year 2008, the net cash flows from Southern Auto to Pit Row Auto will grow at a constant rate of 7 percent