Insignia Corporation Limited Income Statement For the years ended December 31, 2019 & 2020 Sales Cost of Goods Sold Selling & Marketing Costs Admin. Expenses Depreciation Expense Earnings before Interest & Taxes Interest Expense Taxable income Taxation (30%) Net Income 2019 ('000s) 900,000 (350,000) (75,000) (65,000) (55,000) 355,000 (25,000) 330,000 (99,000) 231,000 2020 ('000s) 1035,000 (400,000) (80,000) (75,000) (60,000) 420,000 (30,000) 390,000 (117,000 273,000 Dividends (40%) Addition to Retained Earnings 92,400 138,600 109,200 163,800 Insignia Corporation Limited Statement of Financial Position As at December 31, 2018 & 2019 2019 ('000s) 2020 (000s) 2019 ('000) 2020 ('000) ASSETS Current Assets Inventories Accounts Receivables Cash & Equivalents LIABILITIES & EQUITY Current Liabilities Accounts Payables Notes Payables 350,000 200,000 350,000 900,000 450,000 243,800 395,000 1088,800 160,000 60.000 220,000 175,000 100,000 275,000 Non-current Liabilites 790,000 835,000 Non Current Assets, Net 700,000 805,000 Total Liabilities 1010,000 1110,000 Equity Common Stock Retained Earnings Total Equity 230,000 360,000 590,000 260,000 523.800 783,800 TOTAL ASSETS 1600,000 1893,800 TOTAL LIAB. & EQUITY 1600,000 1893,800 Question 2 20 Marks Utilize the 2020 financial statements for Insignia Corporation Limited provided on pages 1 and 2 above and assume that the company is currently operating at full capacity. Required: Prepare Pro-Forma statements for 2021 (rounding all figures to the nearest dollar) assuming: All costs/income/expenses and net working capital vary directly with sales/revenue. No new equity is raised. Sales are projected to increase by 20%. The tax rate and the dividend payout ratio will remain constant. Interest Expense will remain unchanged. Clearly state if Insignia Corporation Limited will require external financing or would have excess financing in 2021, and how much (20 Marks)