The Kolari Corporation currently has the following ratios:

• Total asset turnover = 1.6 (sales/total assets)
• Total debt to total assets = .5
• Current ratio = 1.7
• Current liabilities = $2,000,000

Question 2, Part A: If Kolaris sales are $16,000,000, what is the amount of total assets? (1.6=sales/TA)

Question 2, Part B: Of the total in (a) above, what is the amount of current assets? (current ratio = CA/CL=1.7)

Question 2, Part C: What is the total debt of the firm? (total debt to assets = total debt/TA from (a))

Question 2, Part D: If Kolaris sales are expected to increase by $6,400,000 and existing ratios remain unchanged, what is the amount additional assets required?

Hint: use 6,400,000 as your sales figure to compute your additional assets. Use the total asset turnover ratio as this not change.