Abha Electrical Manufacturing Company produces and sells one type of Washing Machines since 2000. The following information related to company's financial statements for 2019 reported by Saudi Arabia Riyal (SAR):

Abha Electrical Company-Income Statement 31/12/2019

Sales RevenuesSAR 929,000

Cost of Goods SoldSAR 723,000

Gross ProfitSAR 206,000

Other ExpensesSAR 19,000

EBITSAR 187,000

Interest ExpensesSAR 14,000

EBTSAR 173,000

TaxSAR 60,550

Net IncomeSAR 112,450

Cash Dividends30%

Abha Electrical Company-Balance Sheet 31/12/2019

AssetsLiabilities & Owners' Equity

Cash SAR 25,300Accounts payablesSAR 68,000

Accounts receivablesSAR 40,700Notes payables SAR 17,000

Inventory SAR 86,900Long term debtSAR 158,000

Total current assetsSAR 152,900Common stocksSAR 140,000

Net fixed assetsSAR 413,000 Retained earningsSAR 182,900

Total assets SAR 565,900 Total liabilities & O.ESAR 565,900

The Chief Executive Officer (CEO) of the company was studying the current financial statements in order to plan for 2020. The CEO projected that sales will grow by 20% next year. The CEO of the company could not determine if the company needs extra financing, so he asked you (as a financial manager) to:

1.Prepare the Pro forma financial statements for 2020.

2.As a plug variable, determine the external borrowing needed to support the 20% growth rate knowing that the tax rate and the dividend payout rate will remain constant. Costs, other expenses, current assets, and accounts payable increase naturally with sales.