20 Proforma Income Statement SALO EX 6.8. The balance sheet of Free Enterprises, Inc., at the end of 2018 follows. Free Enterprises, Inc. Balance Sheet, Dec. 31, 2018 (Thousands of Dollars) Assets Liabilities - Equity Cash $ 4,000 Accounts Payable $ 4,400 Accounts Receivable 10,000 Notes Payable 4,000 Inventory 13,000 Accrued Expenses 5,000 Prepaid Expenses 400 Total Current Liabilities 13,400 Total Current Assets 27,400 Bonds Payable 6,000 Fixed Assets 11,000 Common Equity 19.000 Total Assets $ 38,400 Total Liabilities and Equity $ 38,400 s b. Net sales for 2018 were $85,000,000. The average annual sales growth rate is expected to be 10 percent every year for the next three years. Over the past several years the earnings before taxes (EBT) were 18 percent of net sales and are expected to remain the same over the next three years. The company's tax rate is 25 percent, and it plans to maintain the dividend payout ratio (dividends paid net income) at 60 percent. Prepare a pro forma balance sheet for Free Enterprises, Inc., for December 31, 2019. Assume the accounts that are not a function of sales (fixed assets, notes payable, and bonds payable) remain the same as they were in 2018. Current assets and current liabilities will remain the same percentage of sales as in 2018. Assume the only change to common equity is for the addition to retained earnings