1. Consider the following simplified financial statements. Income statement Sales Costs Net income Balance sheet $ 39,400 Assets $ 29,200 Debt $ 9,400 34,700 Equity 19,800 4,700 Total $ 29,200 Total $ 29,200 The company has predicted a 15% sales increase. It has predicted that every item on the balance sheet will increase by 15% as well. Create the pro forma statements. What is the plug variable for balancing the balance sheet? 2. In Question 1, assume the company pays out 50% of net income as cash dividends to shareholders. Assuming also that costs and assets vary with sales, but debt and equity do not. Create the pro forma financial statements and determine the external financing needed.