Krogh Lumber's 2015 financial statements are shown here.

Krogh Lumber: Income Statement for December 31, 2015 (Thousands of Dollars)
Sales................................................$36,000
Operating costs including depreciation..........30,783
Earnings before interest and taxes...............$ 5,217
Interest................................................1,017
Earnings before taxes..............................$ 4,200
Taxes (40%)..........................................1,680
Net income..........................................$ 2,520
Dividends (60%)...................................$ 1,512
Addition to retained earnings.....................$ 1,008
a. Assume that the company was operating at full capacity in 2015 with regard to all items except fixed assets; fixed assets in 2015 were being utilized to only 75% of capacity. By what percentage could 2016 sales increase over 2015 sales without the need for an increase in fixed assets?
b. Now suppose 2016 sales increase by 25% over 2015 sales. Assume that Krogh cannot sell any fixed assets. All assets other than fixed assets will grow at the same rate as sales; however, after reviewing industry averages, the firm would like to reduce its operating costs/sales ratio to 82% and increase its total liabilities-to-assets ratio to 42%. The firm will maintain its 60% dividend payout ratio, and it currently has 1 million shares outstanding. The firm plans to raise 35% of its 2016 forecasted interest-bearing debt as notes payable, and it will issue bonds for the remainder. The firm forecasts that its before-tax cost of debt (which includes both short- and long-term debt) is 11%. Any stock issuances or repurchases will be made at the firm's current stock price of $40. Develop Krogh's projected financial statements like those shown in Table 17.2. What are the balances of notes payable, bonds, common stock, and retained earnings?

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Krogh Lumber: Balance Sheet as of December 31, 2015 (Thousands of Dollars) $ 1,800 10,800 12,600 $25,200 7,200 2,520 3,472 $13,192 5,000 2,000 26,608 $46,800 Cash Receivables Inventories Total current assets Accounts payable Accrued liabilities Notes payable Total current liabilities Mortgage bonds Common stock Retained earnings Total liabilities and equity Net fixed assets 21,600 Total assets $46,800