River Investment Company is operating a business in a dynamic and competitive environment of the MENA region. To cope with the dramatic change in the financial market, the management is quite conscious about the expected change in fixed assets and net working capital and their implications on liabilities and equity. Information for the year 2020 could be summarized as follows:

- Total Assets = $160,000,000

- Fixed Assets = 0.45 TA

- Long-term investments = 0.20 TA

- Intangible Assets = 0.04 TA

- Sales = 240,000,000

- Financial leverage = 40%

- Current liabilities = 28,000,000

Based on the prediction for the year 2021, the expected change of NWC will be 14% and the expected change of FA will be 16%. To strengthen its equity, the Co. will issue new shares in Dubai Financial Market to the level not exceeding 30% of the equity of the year 2020.

The profit margin for the year 2021 is anticipated to be 10%. The DPR in 2020 is 30% and expected to soar up by 20% in the year 2021. The depreciation rate will remain at 10%.

Required:

1. Based on the EFM, give a comprehensive reading of the Co. profile in 2021 and implications on change in debt.

2. Figure out the implications on TA, TL, and equity with more elaboration on the expected change in the balance sheet components.