Suppose that Psy Ops Industries currently has the following balance sheet, and that sales for the year just ended were $5 million. The firm also has a profit margin of 25 percent, a retention ratio of 30 percent, and expects sales of $8 million next year. If fixed assets have enough capacity to cover the increase in sales and all other assets and current liabilities are expected to increase with sales, what amount of additional funds will Psy Ops need from external sources to fund the expectedgrowth?

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Assets Liabilities and Equity Current assets $2,000,000 Current liabilities Fixed assets 4,000,000 Long-term debt S1,500,000 1,500,000 3,000,000 $6,000,000 Equity Total liabilities and equity Total assets $6,000,000