Use the following information from the Long Island Wind Farm to answer questions 1 - 14. 2021 Current Assets - $105,000 2021 Current Liabilities - $95,000 2022 Current Assets - $125,000 2022 Current Liabilities - $110,000 2021 Fixed Assets - $405,000 2021 Long Term Debt - $150,000 2022 Fixed Assets - $440,000 2022 Long Term Debt - $160,000 2022 EBIT - $80,000 2021 Common Stock - $250,000 2022 Depreciation - $75,000 2022 Common Stock - $250,000 2022 Interest - $16,000 2021 Add to Ret. Erngs - $15,000 2022 Tax Rate 25% 1. (2 points) What is Long Island Wind Farms 2022 Taxable Income? 2. (2 points) How much would it have to pay in taxes in 2022? 3. (2 points) What is 2022 Net Income? 4. (2 points) What is 2022 Operating Cash Flow? 5. (2 points) What was the change in Net Working Capital from 2021 to 2022? 6. (2 points) What was Net Capital Spending in 2022? 7. (2 points) What is 2022 Cash Flow from Assets? 8. (2 points) How much did the company add to Retained Earnings in 2022? 9. (2 points) How much of 2022Net Income was paid out as dividends? 10. (2 points) What is Cash Flow to Stockholders in 2022? 11. (2 points) What is Cash Flow to Creditors in 2022? 12. (2 points) What is 2022s Return on Assets? (take answers to 4 decimal points) 13. (2 points) What is 2022s Return on Equity? 14. (4 points) Assuming the company is going to have a dividend payout ratio of 40%, what is: (take your answers to 4 decimal points) a. Its Internal Growth Rate? b. Its Sustainable Growth Rate? Use the following information for questions 15 - 20. Green Tech Laboratories has assets of $25 million supported by $10 million in debt and $15 million in owners equity. Its 2021 net income was $5 million, and its retention ratio was 40%. Assume that net income grows at the same rate as assets, and that funding for the increase in assets first comes only from additions to retained earnings.

FIN 3301 Quiz 1, Page 2 15. (4 points) Find external funding needed for growth rates of: a. 15% b. 20% 16. (4 points) How much debt has to be added to maintain Green Techs debt to equity ratio when it grows by: a. 15% b. 20% 17. (4 points) What is the change in equity if the debt to equity is maintained and the company grows by: a. 15% b. 20% 18. (2 points) From your answer to 17, is the sustainable growth rate higher or lower than 15%? 19. (1 point) In words, describe what would happen to external funding needed for a and b the retention ratio decreased. 20. (3 points) In words, describe what happens to Green Techs debt to equity ratio if it grows at: a. Its Internal Growth Rate b. Its Sustainable Growth Rate c. More than its Sustainable Growth Rate and uses only equity for its external financing needs. 21. (4 points) A company with $20 million in assets has a debt to equity ratio of 1.00 and a retention ratio of 0.40. Its Internal Growth Rate is 6.38% and its Internal Growth rate of 13.64%. What is this companys net income (rounded up to the nearest million)? 22. (4 points) How much would a $15 million asset company have to have in total debt if it grew by 20% and wanted to keep a debt to ratio of: a. 50% b. 75% 23. (4 points) In words, describe what a company can do if it grows at a rate between its internal growth rate and sustainable growth rate and wants to maintain its debt to equity ratio.