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Super Fun Toys, Inc., has the following balance sheet:
Super Fun Toys, Inc., has the following balance sheet:
Assets
Current assets $3,500,000
Fixed assets 5,100,000
Total assets $8,600,000
Liabilities and Equity
Current liabilities $2,400,000
Long-term debt 2,100,000
Equity 4,100,000
Total liabilities & equity $8,600,000
Suppose Super Fun Toys, Inc., has sales of $8.9 million for the year just ended, the profit margin of the firm is 16 percent with a retention rate of 28 percent, and the firm expects sales of $9.8 million next year. If all assets and current liabilities are expected to grow with sales, what amount of additional funds will Super Fun Toys need from external sources to fund the expected growth?
A. $187,925
B. $552,800
C. $368,484
D. $689,500
