1 The most recent financial statements for Crosby, Inc., follow. Sales for 2018 are projected to grow by 25 percent. Interest expense will remain constant; the tax rate and the dividend payout rate will also remain constant. Costs, other expenses, current assets, and accounts payable increase spontaneously with sales. ped CROSBY, INC. 2017 Income Statement Sales Costs Other expenses $745,000 580,000 16,000 sok ences Earnings before interest and taxes Interest paid $ 149,000 12,000 Taxable income Taxes (22%) $ 137,000 30,140 Net income $ 106,860 Dividends Addition to retained earninas $ 33,127 73,733 CROSBY, INC. Balance Sheet as of December 31, 2017 Assets Liabilities and Owners' Equity Current assets Current liabilities Cash $ 20,440 Accounts payable $ 54,600 Accounts receivable 43,380 Notes payable 13,800 Inventory 89,960 Total $ 68,400 Total $ 128,000 Fixed assets Net plant and equipment $ 153,780 Long-term debt Owners' equity $421,000 Common stock and paid-in surplus Retained earnings $ 113,500 264,880 Total $378,380 Total assets $574,780 Total liabilities and owners' equity $ 574,780 1 In 2017, the firm operated at 80 percent of capacity. Construct the pro forma income statement and balance sheet for the company. Assume that fixed assets are sold so that the company has a 100 percent asset utilization. (Do not round intermediate calculations.) ped Pro Forma Income Statement Sales Costs ok ences Other expenses EBIT Interest Taxable income Taxes Net income 11 of 15 Next > 11 of 15