use the tables below to answer should be perfectly readable now

MINI CASE After Ed completed the ratio analysis for Tuxedo Air (see Chapter 3), Mark and Jack approached him about planning for next year's sales. The company had historically used little planning for investment needs. As a result, the company experienced some challenging times because of cash flow problems The lack of planning resulted in missed sales, as well as periods where Mark and Jack were unable to draw salaries. To this end, they would like Ed to prepare a financial plan for the next year so the company can begin to address any outside investment requirements. The statements of comprehensive income and financial position are shown here: Questions 1. Calculate the internal growth rate and sustainable growth rate for Tuxedo Air. What do these numbers mean? 2. Tuxedo Air is planning for a growth rate of 12 percent next year. Calculate the EFN for the company assuming the company is operating at full capacity. Can the company's sales increase at this growth rate? 3. Most assets can be increased as a percentage of sales. For instance, cash can be increased by any amount. However, fixed assets must be increased in specific amounts because it is impossible, as a practical matter, to buy part of a new plant or machine. In this case, a company has a 'staircase" or "lumpy fixed cost structure. Assume Tuxedo Air is currently producing at 100 percent capacity. As a result, to increase production, the company must set up an entirely new line at a cost of $5,000,000. Calculate the new EFN with this assumption. What does this imply about capacity utilization for the company next year? Tuxedo Alr Inc. 2015 Statement of Comprehensive Income Sales $36,599 300 Cost of goods sold 26,669,496 Other expenses 4,641,000 Depreciation 1,640,200 EBIT $ 3,648,604 Interest 573,200 Taxable income $ 3,075,404 Taxes (40%) 1,230,162 Net income 1,845,242 Dividends $560,000 Addition to retained earnings 1,285,242 Click here for a description of Table: Mini-Case: Tuxedo Air Inc. 2015 Statement of Comprehensive Income MINI CASE After Ed completed the ratio analysis for Tuxedo Air (see Chapter 3), Mark and Jack approached him about planning for next year's sales. The company had historically used little planning for investment needs. As a result, the company experienced some challenging times because of cash flow problems The lack of planning resulted in missed sales, as well as periods where Mark and Jack were unable to draw salaries. To this end, they would like Ed to prepare a financial plan for the next year so the company can begin to address any outside investment requirements. The statements of comprehensive income and financial position are shown here: Questions 1. Calculate the internal growth rate and sustainable growth rate for Tuxedo Air. What do these numbers mean? 2. Tuxedo Air is planning for a growth rate of 12 percent next year. Calculate the EFN for the company assuming the company is operating at full capacity. Can the company's sales increase at this growth rate? 3. Most assets can be increased as a percentage of sales. For instance, cash can be increased by any amount. However, fixed assets must be increased in specific amounts because it is impossible, as a practical matter, to buy part of a new plant or machine. In this case, a company has a 'staircase" or "lumpy fixed cost structure. Assume Tuxedo Air is currently producing at 100 percent capacity. As a result, to increase production, the company must set up an entirely new line at a cost of $5,000,000. Calculate the new EFN with this assumption. What does this imply about capacity utilization for the company next year? Tuxedo Alr Inc. 2015 Statement of Comprehensive Income Sales $36,599 300 Cost of goods sold 26,669,496 Other expenses 4,641,000 Depreciation 1,640,200 EBIT $ 3,648,604 Interest 573,200 Taxable income $ 3,075,404 Taxes (40%) 1,230,162 Net income 1,845,242 Dividends $560,000 Addition to retained earnings 1,285,242 Click here for a description of Table: Mini-Case: Tuxedo Air Inc. 2015 Statement of Comprehensive Income