Eastern Family reports the following for this year:

Current Assets	$2.5 million
Fixed Assets	$2.0 million
Current Liabilities	$1.0 million
Long-Term Debt	$2.5 million
Owner’s Equity	$1.0 million
Sales	$10.0 million
Net Income	$1.5 million
Dividends	$1.0 million

Eastern Family is expecting sales growth of 15% next year. The firm will not invest in any long-term assets. Assume that all current assets and current liabilities are spontaneous and that the changes in owner’s equity are based on the change in retained earnings only. What is the discretionary financing need for Eastern Family?

answer options

0.45 mill

-0.35 mill

-0.50 mill

0.30 mill

Answer rating: 100% (QA)

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