In 2019, sales were $14 million, net income was $560,000, and dividends $70,000. Sales will increase 15% in 2020 and the company will double its dividend payout ratio for 2020. Assume the company is at full capacity, so its assets and spontaneous liabilities will increase proportionately with an increase in sales. Assume any additional funds needed (AFN) will come from issuing new long-term debt. Given its forecast, how much long-term debt will the company have to issue in 2020?

options:

	$717,000
	$768,000
	$696,000
	$637,000

Waterman Rainwear Ltd. has the following balance sheet as of December 31, 2019. Current assets $6,000,000 Accounts payable $ 1,000,000 Fixed assets 4,000,000 Accrued liabilities 1,000,000 Notes payable 1,000,000 Long-term debt 3,000,000 Total common equity 4,000,000 Total assets $10,000,000 Total liabilities and equity $10,000,000 Waterman Rainwear Ltd. has the following balance sheet as of December 31, 2019. Current assets $6,000,000 Accounts payable $ 1,000,000 Fixed assets 4,000,000 Accrued liabilities 1,000,000 Notes payable 1,000,000 Long-term debt 3,000,000 Total common equity 4,000,000 Total assets $10,000,000 Total liabilities and equity $10,000,000