The 2019 financial statements for Growth Industries are presented below. Sales and costs are projected to grow at 30% a year for at least the next 4 years. Both current assets and accounts payable are projected to rise in proportion to sales. The firm is currently operating at full capacity, so it plans to increase fixed assets in proportion to sales, Interest expense will equal 10% of long-term debt outstanding at the start of the year. The firm will maintain a dividend payout ratio of 0.40. INCOME STATEMENT, 2019 Sales $390,000 Costs 245,000 EBIT 145,000 Interest expense 29,000 Taxable income 116,000 Taxes (at 214) 24,360 Net income 91,640 Dividends $36,656 Addition to retained earnings $54,984 Assets Current assets Cash Accounts receivable Inventories Total current assets Net plant and equipment BALANCE SHEET, YEAR-END, 2019 Liabilities Current liabilities $ 8,000 Accounts payable 13,000 Total current liabilities 29,000 Long-tern debt $ 50,000 Stockholders' equity 330,000 Common stock plus additional paid-in capital Retained earnings $ 380,000 Total liabilities plus stockholders' equity $ 15,000 $ 15,000 290,000 15,000 60,000 $ 380,000 Total assets Required: Construct a spreadsheet model for Growth Industries similar to the one in Spreadsheet 18.1. a. How much external capital will the company require in 2023? b. What will be the company's debt ratio at the end of 2023? Complete this question by entering your answers in the tabs below. Spreadsheet Model Reg A and B Complete this question by entering your answers in the tabs below. Spreadsheet Req A and B Model Construct a spreadsheet model for Growth Industries similar to the one in Spreadsheet 18.1. (Do not round in calculations. Round your answer to 1 decimal place. Enter your answers in thousands and Enter the "Debt ratio" decimal places.) A Long-Term Planning Model for Growth Industries Income Statement 2019 2020 2021 2022 2023 Revenue 390.0 Cost of goods sold 245.0 EBIT 145.0 Interest expense 29.0 Earnings before taxes 116.0 Taxes at 50% 24.4 Net income 91.6 Dividends 36.7 Reinvested earnings 55.0 Balance Sheet (year-end) Assets Not working capital Net fixed assets Total assets 35.0 330.0 365.0 Liabilities and equity Long-term debt Shareholders' equity Total liab. & share, equity 290.0 75.0 365.0 Sources and Uses of Funds Operating cash flow Increase in working capital Investments in fixed assets Dividends Total uses of cash Required external financing Financial Ratios Debt ratio Interest coverage The 2019 financial statements for Growth Industries are presented below. Sales and costs are projected to grow at 30% a year for at least the next 4 years. Both current assets and accounts payable are projected to rise in proportion to sales. The firm is currently operating at full capacity, so it plans to increase fixed assets in proportion to sales. Interest expense will equal 10% of long-term debt outstanding at the start of the year. The firm will maintain a dividend payout ratio of 0.40. INCOME STATEMENT, 2019 Sales $390,000 Costs 245,000 EBIT 145,000 Interest expense 29,000 Taxable income 116,000 Taxes (at 214) 24,360 Net income 91,640 Dividends $36,656 Addition to retained earnings $54,984 Assets Current assets Cash Accounts receivable Inventories Total current assets Net plant and equipment Total assets BALANCE SHEET, YEAR-END, 2019 Liabilities Current liabilities $ 8,000 Accounts payable 13,000 Total current liabilities 29,000 Long-term debt $ 50,000 Stockholders' equity 330,000 Common stock plus additional paid-in capital Retained earnings $ 380,000 Total liabilities plus stockholders' equity 2 53 Required: Construct a spreadsheet model for Growth Industries similar to the one in Spreadsheet 18.1 a. How much external capital will the company require in 2023? b. What will be the company's debt ratio at the end of 2023? Complete this question by entering your answers in the tabs below. Spreadsheet Req A and B Model a. How much external capital will the company require in 2023? b. What will be the company's debt ratio at the end of 2023? (Round Intermediate values to 1 decimal place. Round your answer to 2 decimal places.) a. External financing b. Debt ratio