hi, can someone help me to forecast the financial planning for 1998 using vertical analysis based on the exhibits below.

How much total bank financing will the company need at the end of 1998, including both the short-term borrowing under the bank credit line and the outstanding amount of the term loan? (For convenience, assume that 1998 sales are $3,000,000)

Notes and input data
Sales growth	13.21%
Interest rate on all debt	6.69%
Fixed assets capacity utilization	100%
Fixed assets growth rate	11.86%
Percentage of distribution to shareholders:	31.50%

Exhibit 3 Be Our Guest, Inc. Income Statement
		Years Ended December 31
	1994	1995	1996	1997
Revenue:
Rental Income	$ 1,620,313	$ 1,794,807	$ 1,990,853	$ 2,469,474
Delivery Income	$ 156,035	$ 179,173	$ 168,959	$ 180,567
Total Revenue	$ 1,776,348	$ 1,973,980	$ 2,159,812	$ 2,650,041
Cost of Revenue:
Salaries	$ 490,968	$ 575,253	$ 547,611	$ 610,602
Other Cost of Revenue	$ 211,468	$ 302,877	$ 347,094	$ 419,050
Depreciation	$ 116,119	$ 127,906	$ 128,299	$ 148,707
Gross Profit	957,793	$ 967,944	$ 1,136,808	$ 1,471,682
Operating Expenses:
General and Administrative Salaries	$ 381,501	$ 434,434	$ 539,168	$ 840,718
Other General and Admin. Expenses (a)	$ 116,119	$ 127,906	$ 128,299	$ 148,707
Bad Debt Expense	$ 5,702	$ 977	$ 22,186	$ 5,188
	$ 789,626	$ 820,274	$ 982,037	$ 1,346,290
Earnings from Operations	$ 168,167	$ 147,670	$ 154,771	$ 125,392
Interest, Net	$ (27,820)	$ (33,912)	$ (44,545)	$ (37,580)
Net Earnings	$ 140,347	$ 113,758	$ 110,226	$ 87,812
Distributions To Shareholders	$ (60,000)	$ (46,700)	$ (95,000)	$ (27,660)
Earnings Retained	$ 80,347	$ 67,058	$ 15,226	$ 60,152
(a) Other General and Administrative Expenses include depreciation of $3,692; $8,322; $14,025;
and $22,612 for the years 1994 through 1997 respectively.

E F G H A 1 Exhibit 4 Be Our Guest, Inc. Balance Sheets WN December 31, 4 1994 1995 1996 1997 5 6 ASSETS 8 Current Assets: 9 Cash (Overdraft) $ (2,595) S 565 $ 645 $ (3,498) 10 Accounts Receivable (a) 228,333 303,430 303,476 346,109 11 Due from Officers & Employees 5,000 13,617 22,552 16,763 12 Loan Receivable from Shareholder (b) 7,500 7,500 7,500 7,500 13 Other Current Assets 682 13,332 700 2,678 14 Total Current Assets 238,920 338,444 334,873 369,552 16 Property and Equipment: 17 Rental Equipment 768,481 928,391 1,077,484 1,251,080 18 Leasehold Improvements & Other Equipment 102,272 133,850 208,827 278,508 19 870,753 1,062,241 1,286,311 1,529,588 20 Less Accumulated Depreciation 414,988 551,214 679,734 851,053 21 Net Property and Equipment 455,765 511,027 606,577 678,535 22 23 Other Assets: 24 Loan Receivable from Shareholder (b) 30,000 20,000 10,000 10,000 25 Due from Affiliate (c) 110,000 110,000 158,000 65,950 26 140,000 130,000 168,000 75,950 27 28 Total Assets $ 834,685 S 979,471 $ 1,109,450 $ 1,124,037 29 30 LIABILITIES AND STOCKHOLDERS' EQUITY 32 Current Liabilities: 33 Borrowings under Bank Line of Credit $ 75,000 $ $ 98,270 $ 140,000 34 Current Installments of Term Note (d) 32,539 53,388 70,651 75,268 36 Due to Officer 17,000 32,816 32,816 37 Accounts Payable and Accounts 63,465 69,233 88,296 103,155 38 Total Current Liabilities 188,004 155,437 290,033 318,423 40 Term Notes Payable, Less Current Install. (d) 226,814 337,109 317,266 243,311 41 42 Total Liabilities 414,818 492,546 607,299 561,734 43 44 Shareholders' Equity: 45 Common Stock, $1 Par Value 2,000 2,000 2,000 2,000 46 Additional Paid-In Capital 74,000 74,000 74,000 74,000 47 Retained Earnings 343,867 410,925 426,151 486,303 48 Total Shareho Equity 419,867 486,925 502, 151 562,303 49 50 Total Liabilities and Shareholders' Equity S 834,685 S 979,471 S 1,109,450 $ 1,124,037 51 52 53 (a) Accounts Receivable are shown net of allowance for doubtful accounts of $5,000. 54 (b) A loan was made to a shareholder to purchase shares. $17,500 was outstanding as of 12/31/97. 55 (c) At Dec. 31, 1996, the outstanding balance of the bank term loan was $383,484 of which $69,893 was 56 due in one year. 57 The initial borrowing arrangement consisted of two parts, a $100,000 line of credit and a $390,000, five-year term loan. Borrowings could take place at any time under the line of credit at an interest rate equal to the bank's prime rate plus 1.5%. Interest on the term loan was fixed at 9.25% and monthly payments of principal and interest totaling $8,143 were required. The bank imposed several covenants as part of the loan agreement, including requirements that the shareholders guarantee the loans and that virtually all the firm's assets be pledged as collateral against the loans. Other restrictions included limits on debt ratios, advances and distributions to principals, and net earnings losses. See Exhibit 8 for a list of the covenants. In late 1997 the company requested a $40,000 increase in its credit line to help finance the receivables resulting from a large increase in December sales. Thus, Be Our Guest ended the year with a fully used $140,000 line and an outstanding balance of about $318,000 on its term loan. Estimating its needs for the next 12 months was difficult as usual. Sales early in 1998 had been a little stronger than in prior years and Lovata wanted to make sure that the firm would be able to finance at least a 10-15% growth in its business. The management team also wondered whether it was time to rethink the amount of the term loan versus the credit line. It had not been able to pay the credit line down to zero during the past year as the bank preferred. Compounding the uncertainty, the company was evaluating an upgrade in their computer and telephone systems, but the amount and timing of this investment was still uncertain. Exhibit 8 Representative Covenants on State Street Bank Loan The Borrower Will Not: 1. Permit its Cash Flow/Debt Service Ratio for the year to be less than 1.25:1. (Cash Flow defined as net income plus interest expense and depreciation less distribution to shareholders. Debt Service defined as interest and principal payments due on debt.) 2. Permit its Debt/Tangible Net Worth Ratio to be greater than 2.00:1. (Tangible Net Worth defined as net worth less loans to principals and related entities.) 3. Incur any additional outside debt, other than normal trade debt. 4. Advance any additional funds to the principals or related entities. 5. Distribute more than 50% of annual earnings to the principals. 6. Incur two consecutive quarters of net losses; nor incur a net loss for any fiscal year. In addition to the negative convenants above, virtually all of the company's assets were pledged and company shareholders guaranteed the loan. E F G H A 1 Exhibit 4 Be Our Guest, Inc. Balance Sheets WN December 31, 4 1994 1995 1996 1997 5 6 ASSETS 8 Current Assets: 9 Cash (Overdraft) $ (2,595) S 565 $ 645 $ (3,498) 10 Accounts Receivable (a) 228,333 303,430 303,476 346,109 11 Due from Officers & Employees 5,000 13,617 22,552 16,763 12 Loan Receivable from Shareholder (b) 7,500 7,500 7,500 7,500 13 Other Current Assets 682 13,332 700 2,678 14 Total Current Assets 238,920 338,444 334,873 369,552 16 Property and Equipment: 17 Rental Equipment 768,481 928,391 1,077,484 1,251,080 18 Leasehold Improvements & Other Equipment 102,272 133,850 208,827 278,508 19 870,753 1,062,241 1,286,311 1,529,588 20 Less Accumulated Depreciation 414,988 551,214 679,734 851,053 21 Net Property and Equipment 455,765 511,027 606,577 678,535 22 23 Other Assets: 24 Loan Receivable from Shareholder (b) 30,000 20,000 10,000 10,000 25 Due from Affiliate (c) 110,000 110,000 158,000 65,950 26 140,000 130,000 168,000 75,950 27 28 Total Assets $ 834,685 S 979,471 $ 1,109,450 $ 1,124,037 29 30 LIABILITIES AND STOCKHOLDERS' EQUITY 32 Current Liabilities: 33 Borrowings under Bank Line of Credit $ 75,000 $ $ 98,270 $ 140,000 34 Current Installments of Term Note (d) 32,539 53,388 70,651 75,268 36 Due to Officer 17,000 32,816 32,816 37 Accounts Payable and Accounts 63,465 69,233 88,296 103,155 38 Total Current Liabilities 188,004 155,437 290,033 318,423 40 Term Notes Payable, Less Current Install. (d) 226,814 337,109 317,266 243,311 41 42 Total Liabilities 414,818 492,546 607,299 561,734 43 44 Shareholders' Equity: 45 Common Stock, $1 Par Value 2,000 2,000 2,000 2,000 46 Additional Paid-In Capital 74,000 74,000 74,000 74,000 47 Retained Earnings 343,867 410,925 426,151 486,303 48 Total Shareho Equity 419,867 486,925 502, 151 562,303 49 50 Total Liabilities and Shareholders' Equity S 834,685 S 979,471 S 1,109,450 $ 1,124,037 51 52 53 (a) Accounts Receivable are shown net of allowance for doubtful accounts of $5,000. 54 (b) A loan was made to a shareholder to purchase shares. $17,500 was outstanding as of 12/31/97. 55 (c) At Dec. 31, 1996, the outstanding balance of the bank term loan was $383,484 of which $69,893 was 56 due in one year. 57 The initial borrowing arrangement consisted of two parts, a $100,000 line of credit and a $390,000, five-year term loan. Borrowings could take place at any time under the line of credit at an interest rate equal to the bank's prime rate plus 1.5%. Interest on the term loan was fixed at 9.25% and monthly payments of principal and interest totaling $8,143 were required. The bank imposed several covenants as part of the loan agreement, including requirements that the shareholders guarantee the loans and that virtually all the firm's assets be pledged as collateral against the loans. Other restrictions included limits on debt ratios, advances and distributions to principals, and net earnings losses. See Exhibit 8 for a list of the covenants. In late 1997 the company requested a $40,000 increase in its credit line to help finance the receivables resulting from a large increase in December sales. Thus, Be Our Guest ended the year with a fully used $140,000 line and an outstanding balance of about $318,000 on its term loan. Estimating its needs for the next 12 months was difficult as usual. Sales early in 1998 had been a little stronger than in prior years and Lovata wanted to make sure that the firm would be able to finance at least a 10-15% growth in its business. The management team also wondered whether it was time to rethink the amount of the term loan versus the credit line. It had not been able to pay the credit line down to zero during the past year as the bank preferred. Compounding the uncertainty, the company was evaluating an upgrade in their computer and telephone systems, but the amount and timing of this investment was still uncertain. Exhibit 8 Representative Covenants on State Street Bank Loan The Borrower Will Not: 1. Permit its Cash Flow/Debt Service Ratio for the year to be less than 1.25:1. (Cash Flow defined as net income plus interest expense and depreciation less distribution to shareholders. Debt Service defined as interest and principal payments due on debt.) 2. Permit its Debt/Tangible Net Worth Ratio to be greater than 2.00:1. (Tangible Net Worth defined as net worth less loans to principals and related entities.) 3. Incur any additional outside debt, other than normal trade debt. 4. Advance any additional funds to the principals or related entities. 5. Distribute more than 50% of annual earnings to the principals. 6. Incur two consecutive quarters of net losses; nor incur a net loss for any fiscal year. In addition to the negative convenants above, virtually all of the company's assets were pledged and company shareholders guaranteed the loan