12) Pro Forma Financial Statements Use the following financial statements for the questions below: Income a. Create a pro forma income statement and a balance sheet for Roger's new business. Assume the percent of sales approach and decide whether there is excess cash or AFN (Assets - Liabilities and Owner's Equity). Sales are expected to be 120,000 in 2023. Tax rate is constant. Payout ratio is also constant, and the firm is at full capacity. Interest expense is 1% of long-term debt. b. For a second approach, use the long AFN equation. c. Why are the AFNs from parts a. and b. different? d. Consider how the following would affect the AFNs calculated above: i. Sales increase ii. Retention ratio decreases