Bill Inc.'s last year financial statements are shown below:

Bill Inc. Balance Sheet as of December 31

Cash		$ 90,000		Accounts payable		$ 180,000
Receivables		180,000		Notes payable		78,000
Inventory		360,000		Accruals		90,000
Total current assets		$ 630,000		Total current liabilities		$ 348,000
				Common stock		900,000
Net fixed assets		720,000		Retained earnings		102,000
Total assets		$1,350,000		Total liabilities and equity		$1,350,000

Bill Inc. Income Statement for December 31

Sales		$1,800,000
Operating costs		1,639,860
EBIT		$ 160,140
Interest		10,140
EBT		$ 150,000
Taxes (40%)		60,000
Net income		$ 90,000
Dividends (60%)		$ 54,000
Addition to retained earnings		$ 36,000

Suppose that next year's sales will increase by 20 percent over last year's sales. Assume that fixed assets are only being operated at 95 percent of capacity. Construct the proforma financial statements using the percent of sales method. How much additional capital will be required?

• A. a. $73,218
• B. b. $85,201
• C. c. $91,873
• D. d. $100,800
• E. e. $129,113