1. Recent Financial Statements of Barrettii Co.

   Income statement			Balance sheet
   Sales	$100	Assets	$50	Debt	$20
   Costs	80			Equity	30
   Net Income	$20	Total	$50	Total	$50

   How much new debt will the firm raise (i.e., borrow more) next year if its sales are projected to grow at a sustainable growth rate? No new equity raised. Assume that the earning retention ratio is 0.5.

   		$9
   		$10
   		$4
   		$12
   		$5