The most recent balance sheet is as follow: Cash 1,000,000 Accounts payable 700,000 Marketable securities 800,000 Notes Payable 2,000,000 Accounts receivable 1,200,000 Accruals 1,300,000 Inventory 2,000,000 Current liabilities 4,000,000 Current Assets 5,000,000 Long-term debt 5,400,000 Common stock 4,600,000 Fixed assets 15,000,000 Retained earnings 6,000,000 Total assets 20,000,000 Total liabilities and equity 20,000,000 The firm estimates sales will increase from $40 million to $50 million. The firm's profit margin is 5 percent, and its dividend payout ratio is 40 percent. The firm's fixed assets were used to only 96% of the capacity. [1] First, calculate AFA [2] Using the AFN formula method, determine how much outside financing is required. Expand the following equation by plugging numbers in the last term. CA L CA EFN=AFN= AS+AFA -AS-MS (1-d) = AS+AFA -AS-MS (1-0) S S