Discuss the role of the income statement and balance sheet in the estimation of required external funding and the use of financial leverage.

8.How does the construction of pro forma financial statements offer insight to a company's growth management challenges?

9.Why does financial leverage increase the variability of returns to owners?

10.Describe how a corporation enhances the growth of profitability, because of the relationship between financial leverage and operating leverage.

11.Recommendations and Conclusion: Conclude your paper to the management team by highlighting some of the potential organizational behaviors that may damage the company through earnings expectations management. Advise the team regarding how to focus on viable growth of profitability through long-term strategic goals?