II Need help in understanding where the retained earning of 738.4 came from here. I don't understand what the 59.2 has to do with anything either. Thank you. I understand everything is multiplied by 1.2 but my teacher is writing a different answer for retained and i don't understand.

INCOME STATEMENTS (MILLIONS OF DOLLARS) 2015 $3,000.0 2,550.0 $450.0 2017 2016 $3,600.0 3.060.0 $ 540.0 Sales $4,320 Operating ests EBITDA Depreciation and amortization Earnings before interest and taxes 75.0 90.0 90.0 $ 450.0 $ 375.0 65.0 60.0 $ 315.0 Interest 65.0 $ 385.0 Earnings before taxes es (40%) 154.0 231.0 $ 181.5 126.0 $ 189.0 $ 139.0 Net income available to common stockholders Common dividends BALANCE SHEETS (MILLIONS OF DOLLARS) 2016 2015 $ 36.0 $ 30.0 Cash and marketable securities 450.0 Accounts receivable 540.0 Inventorics 540.0 600.0 $1.080.0 750.0 $1,830,0 Total current assets $1,116.0 900.0 $2,016.0 Net plant and equipment Total assets Liabilities and equity: Accounts payable Notes payable 324.0 270.0 201.0 155.0 216.0 741.0 Accruals 180.0 605.0 Total current liabilities Long-term bonds 450.0 450.0 $1,191.0 $1,055.0 Total debt Common stock (50 million shares) Retained earnings Total common equity Total liabilities and equity 150.0 150.0 625.0 675.0 $ 825.0 $2,016.0 $ 775.0 $1,830.0 6. Using percemtage of sales based proforma method, construct new Balance sheet for year 2017 and find out AFN amount. Assume sales increase by 20% in 2017. Currently, a firm utilizes 80% of capacity of fixed asset usage for sales. Assume Interest expense and depreciation will be the same amount as 2016. (capacity_sales = So/% of capacity) Also, a firm use the same dividend payout ratio as 2016. 3600 '6,& BALANCE SHEETS (MILLIONS OF DOLLARS) 2016 $ 36.0 540.0 2017 S 40.0 Cash and marketable securities Accounts receivable Inventories Total current assets 540,0 $1,116.0 Net plant and equipment Total assets 900.0 $2,016.0 2236 Liabilitics and cquity: Accounts payable Notes payable Accruals S 324.0 201.0 201.0 216.0 Total current liabilities 741.0 Long-term bonds Total debt Common stock (50 million shares) Retained carnings 450.0 450.0 $1,191.0 150.0 150.0 738.4 675.0 INCOME STATEMENTS (MILLIONS OF DOLLARS) 2015 $3,000.0 2,550.0 $450.0 2017 2016 $3,600.0 3.060.0 $ 540.0 Sales $4,320 Operating ests EBITDA Depreciation and amortization Earnings before interest and taxes 75.0 90.0 90.0 $ 450.0 $ 375.0 65.0 60.0 $ 315.0 Interest 65.0 $ 385.0 Earnings before taxes es (40%) 154.0 231.0 $ 181.5 126.0 $ 189.0 $ 139.0 Net income available to common stockholders Common dividends BALANCE SHEETS (MILLIONS OF DOLLARS) 2016 2015 $ 36.0 $ 30.0 Cash and marketable securities 450.0 Accounts receivable 540.0 Inventorics 540.0 600.0 $1.080.0 750.0 $1,830,0 Total current assets $1,116.0 900.0 $2,016.0 Net plant and equipment Total assets Liabilities and equity: Accounts payable Notes payable 324.0 270.0 201.0 155.0 216.0 741.0 Accruals 180.0 605.0 Total current liabilities Long-term bonds 450.0 450.0 $1,191.0 $1,055.0 Total debt Common stock (50 million shares) Retained earnings Total common equity Total liabilities and equity 150.0 150.0 625.0 675.0 $ 825.0 $2,016.0 $ 775.0 $1,830.0 6. Using percemtage of sales based proforma method, construct new Balance sheet for year 2017 and find out AFN amount. Assume sales increase by 20% in 2017. Currently, a firm utilizes 80% of capacity of fixed asset usage for sales. Assume Interest expense and depreciation will be the same amount as 2016. (capacity_sales = So/% of capacity) Also, a firm use the same dividend payout ratio as 2016. 3600 '6,& BALANCE SHEETS (MILLIONS OF DOLLARS) 2016 $ 36.0 540.0 2017 S 40.0 Cash and marketable securities Accounts receivable Inventories Total current assets 540,0 $1,116.0 Net plant and equipment Total assets 900.0 $2,016.0 2236 Liabilitics and cquity: Accounts payable Notes payable Accruals S 324.0 201.0 201.0 216.0 Total current liabilities 741.0 Long-term bonds Total debt Common stock (50 million shares) Retained carnings 450.0 450.0 $1,191.0 150.0 150.0 738.4 675.0