Cost percentage = Costs/Sales Depreciation rate Depreciation / Beginning fixed assets Interest rate = Interest paid / Total debt Tax rate Taxes/Net income Payout ratio = Dividends / Net income Capital intensity ratio Fixed assets / Sales The Loftis Company is preparing its pro forma financial statements for the next year using this model. The abbreviated financial statements are presented below Sales growth Tax rate 20% 34% Income Statement Sales Costs Depreciation Interest Taxable income Taxes Net income $ 780,000.00 415,000.00 135,000.00 68,000.00 $ 162,000.00 55,080.00 $ 106,920.00 $ 30,000.00 Dividends Additions to retained earnings $ 76,920.00 Balance Sheet Assets Liabilities and Equity Current assets Net fixed assets Total assets $ 240,000.00 1,350,000.00 $1,590,000.00 Total debt Owners' equity $ 880,000.00 710,000.00 $1,590,000.00 Total debt and equity