Please answer question 22 and 23.

21. Calculating EFN The most recent financial statements for Scott, Inc., appear below. Sales for 2020 are projected to grow by 20 percent. Interest expense will remain con- stant; the tax rate and the dividend payout rate also will remain constant. Costs, other expenses, current assets, fixed assets, and accounts payable increase spontaneously with sales. If the firm is operating at full capacity and no new debt or equity is issued, what external financing is needed to support the 20 percent growth rate in sales? 1 Overview SCOTT, INC. 2019 Income Statement Sales Costs Other expenses Earnings before interest and taxes Interest expense Taxable income Taxes (22%) $891,600 727,900 18,240 $145,460 13,400 $132,060 29,053 100 AW SCOTT, INC. 2019 Income Statement Sales Costs Other expenses Earnings before interest and taxes Interest expense Taxable income Taxes (22%) Net income Dividends Addition to retained earnings $891,600 727,900 18,240 $145,460 13,400 $132,060 29,053 $103,007 $36,224 66,783 SCOTT, INC. Balance Sheet as of December 31, 2019 Assets Liabilities and Owners' Equity Current assets Current liabilities Cash $ 24,280 Accounts payable $ 65,200 Accounts receivable 37,070 Notes payable 16,320 Inventory 83,400 Total $ 81,520 Total $144,750 Long-term debt $155,000 Owners' equity Fixed assets Common stock and paid-in $130,000 Net plant and equipment $396,500 surplus 174,730 Retained earnings $304,730 Total assets $541,250 Total $541,250 Total liabilities and owners' equity 22. Capacity Usage and Growth In the previous problem, suppose the firm was operating at only 80 percent capacity in 2019. What is EFN now? 23. Calculating EFN In Problem 21, suppose the firm wishes to keep its debt-equity ratio constant. What is EFN now? 24. EFN and Internal Growth Redo Problem 21 using sales growth rates of 15 and 25 per- cent in addition to 20 percent. Illustrate graphically the relationship between EFN and the growth rate and use this graph to determine the relationship between them. 25. EFN and Sustainable Growth Redo Problem 23 using sales growth rates of 30 and 35 percent in addition to 20 percent. Assume the company wishes to keep its debt-equity ratio constant. Illustrate graphically the relationship between EFN and the growth rate and use this graph to determine the relationship between them