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Baxter Video Products sales are expected to increase by 20%from $5 million in 20

Baxter Video Products sales are expected to increase by 20%from $5 million in 2010 to $6 million in 2011. Its assets totaled$3 million at the end of 2010. Baxter is already at full capacityso its assets must grow at the same rate as projected sales. At theend of 2010 current liabilities were $1 million consisting of$250000 of accounts payable $500000 of notes payable and$250000 of accruals. The after-tax profit margin is forecasted tobe 5% and the forecasted payout ratio is 70%. Use the AFN equationto forecast Baxters additional funds needed for the comingyear

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