Construct Albert Retail Co's Pro Forma Income Statement and Balance Sheet for Years 1 to 3 under the following policies:

COGS+SG&A+Depreciation = 60% of Revenue

Dividend Payout = 50%

Current Assets = 40% of Revenue

Net Fixed Assets = 60% of Revenue

Current Liabilities = 70% of Current Assets

Corporate Tax Rate = 21%

What would you do for Year 1?

Answer choices:

• Nothing, there will be an excess of cash for $20
• Finance shortfall with Notes Payable for $20
• Finance shortfall with Notes Payable for $8.7
• Nothing, there will be an excess of cash for $8.7

\begin{tabular}{|l|r|r|r|r|} \hline & \multicolumn{3}{|c|}{ Year } \\ \hline & 0(2018) & 1 & 2 & 3 \\ \hline Revenue & 150.0 & 195.0 & 253.5 & 253.5 \\ \hline COGS+SG\&A+Depreciation & 90.0 & & & \\ \hline EBIT & 60.0 & & & \\ \hline Tax (21\%) & 12.6 & & & \\ \hline Net Income & 47.4 & & & \\ \hline & & & & \\ \hline Dividends & 23.7 & & & \\ \hline Addition to Retained Earnings & 23.7 & & & \\ \hline & & & & \\ \hline Current Assets & 60.0 & & & \\ \hline Net Fixed Assets & 90.0 & & & \\ \hline Total Assets & 150.0 & & & \\ \hline Current Liabilities & 42.0 & & & \\ \hline Long-Term Liab - Debt & 30.0 & & & \\ \hline Owners' Equity & 78.0 & & & \\ \hline Total Liabilities and Owners' Equity & 150.0 & & & \\ \hline & & & & \\ \hline Assets - Liabilities \& Owners Equity & 0.0 & & & \\ \hline \end{tabular}