**There should be 4 total answers**

Green Caterpillar Garden Supplies is currently in the process of forecasting sales, asset requirements, and required funding for the coming year. In the year that just ended, the firm generated $350,000 net income on sales of $14,000,000. The firm expects sales to increase by 15% this coming year and also expects to maintain its long-run dividend payout ratio of 45%. Total Current Assets $900,000, Total Current Liabilities $500,000.

Suppose Green Caterpillar Garden Supplies Inc's assets are fully utilized. Use the additional funds needed (AFN) equation to determine the increase in total assets that is necessary to support Green Caterpillar Garden Supplies Inc.'s expected sales.

a. $540,000

b. $450,000

c. 427,500

d. 382,500

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 Green Caterpillar Garden Supplies Inc. this year?

a. $66,000

b. $54,000

c. $60,000

d. $69,000

In addition, Green Caterpillar Garden Supplies Inc. 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 hae to raise eternally from the capital markets. Assume the firm's profit margin and divident payout ration are expected to remain constant

Given the preceding information, Green Caterpillar Garden Supplies Inc is expected to generate $__________ from operations that will be added to retained earnings.

According to the AFN equation and projections for Green Caterpillar Garden Supplies Inc., the firm's AFN is $________?