Question: The following is the balance sheet for 2003 for Marbell Inc.
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Marbell Inc.
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Balance Sheet
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12/31/2003
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Assets
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Liabilities and Stockholders' Equity
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Cash
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$15,000
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Accts. Payable
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$90,000
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Accts. Rec.
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90,000
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Notes payable (non-spontaneous)
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30,000
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Inventory
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60,000
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Accrued expenses
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7,500
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Current Assets
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165,000
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Current Liabilities
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127,500
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Fixed assets (non-spontaneous)
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60,000
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Common stock
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75,000
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Retained earnings
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22,500
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Total assets
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$225,000
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Total Liabilities + S. E. Equity
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$225,000
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Sales for 2002 were $300,000. Sales for 2003 have been projected to increase by 20 percent. Suppose that Marbell Inc. is operating below capacity, compute the amount of new funds needed to finance this growth. Marbell has an 8 percent return on sales & 70% is paid out as dividends.