The firm is currently in the process of forecasting sales, asset requirements, and required funding for the coming year. In the year that just ended,

Blue Elk Manufacturing generated $$400,000$ net income on sales of $$14,500,000.$ The firm expects sales to increase by $16\%$ this coming year and also

expects to maintain its long$-$run dividend payout ratio of $30\%.$

Suppose Blue Elk Manufacturing's assets are fully utilized. Use the additional funds needed $($AFN$)$ equation to determine the increase in total assets

that is necessary to support Blue Elk Manufacturing's expected sales. $($Note: Do not round intermediate calculations.$)$

$$552,000$

$$480,000$

$$384,000$

$$576,000$

When a firm grows, some liabilities grow spontaneously along with sales. Spontaneous liabilities are a source of capital that the firm will generate

internally, so they reduce the need for external capital. How much of the total increase in assets will be supplied by spontaneous liabilities for Blue Elk

Manufacturing this year? $($Note: Do not round intermediate calculations.$)$

$$64,000$

$$76,800$

$$51,200$

$$73,600$

In addition, Blue Elk Manufacturing is expected to generate net income this year. The firm will pay out some of its earnings as dividends but will retain

the rest for future asset investment. Again, the more a firm generates internally from its operations, the less it will have to raise externally from the

capital markets. Assume that the firm's profit margin and dividend payout ratio are expected to remain constant.

Given the preceding information, Blue Elk Manufacturing is expected to generate $

earnings. $($Note: Do not round intermediate calculations.$)$

from operations that will be added to retained

According to the AFN equation and projections for Blue Elk Manufacturing, the firm's AFN is $

$.($Note: Do not round intermediate

calculations.$)$

The Additional Funds Needed $($AFN$)$ equation

Blue Elk Manufacturing has the following end$-$of$-$year balance sheet:

Blue Elk Manufacturing Balance Sheet For the Year Ended on December $31$

$\backslash$table$[[$Assets$,,$Liabilities,$],[$Current Assets:,,Current Liabilities:,$],[$Cash and equivalents,$$150,000,$Accounts payable,$$250,000$