Jonson, Inc. is planning its operations for the coming year, and the CEO wants you to forecast the firm's additional funds needed (AFN). Data for use in the forecast are shown below. However, the CEO...

Jonson, Inc. is planning its operations for the coming year, and the CEO wants you to forecast the firm's additional funds needed (AFN). Data for use in the forecast are shown below. However, the CEO is concerned about the impact of a change in the retention ratio from 90% that was used in the past to 50%, which the firm's investment bankers have recommended. Seventy-five percent of the total assets are considered variable. Based on the AFN equation, by how much would the AFN for the coming year change if Jonson, Inc. decreased the retention from 90% to the new level? All pesos are in millions.

Last year’s sales                             P300.0              Last year’s accounts payable    P40.0

Sales growth rate                           15%                 Last year’s notes payable      P10.0

Last year’s total assets                    P500.0              Last year’s accruals                  P20.0

Last year’s profit margin                 15.0%              Initial retention ratio                       90.0%

What would the company’s capital intensity ratio be if the company changed the retention ratio to the new level?