Suppose that Wind Em Corp. currently has the following balance sheet, and that sales for the year just ended were $7 million. The firm also has a profit margin of 27 percent, a retention ratio of 20 percent, and expects sales of $8 million next year. If all assets and current liabilities are expected to grow with sales, what amount of additional funds will Wind Em need from external sources to fund the expectedgrowth?

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Assets Liabiliies and Equity $2,500,000 1,500,000 3,000,000 Total assets 7,000,000 Total liabilities and equity 7,000,000 Current assets $2,000,000 Current liabilities Fixed assets 5,000,000 Long-term debt Equity