You have been given the following information on the Crum Company. Crum expects sales to grow by 30 percent in the next year and operating costs should increase in proportion to sales. Fixed assets were being operated at 80% of capacity. Current assets and spontaneous liabilities should increase in proportion to sales during the next year. The company plans to finance any external funds needed as 40 percent long-term debt and 60 percent short-term debt. The interest rate to be used is 9 percent. The dividend payout ratio will remain constant. Using the forecasted financial statement method, what is next years addition to retained earnings?

(If the answer is $12.34, enter 12.34)

Most Next Years Next Year

Recent Year Forecast After AFN

Sales $1,000.00

Operating costs 800.00

EBIT $ 200.00

Interest 15.00

EBT $ 185.00

Taxes (40%) 74.00

Net Income $ 111.00

Dividends (60%) 66.60

Addition to R.E. $ 44.40

Current Assets $ 700.00

Net fixed Assets 300.00

Total assets $1,000.00

A/P and Accruals $ 150.00

Notes payable 100.00

Long-term debt 200.00

Common stock 150.00

Retained earnings 400.00

Total Liab & Equity $1,000.00