Integrative Pro forma statements Red Queen Restaurants wishes to prepare financial plans. Use the financial statements and the other information provided hereto prepare the financial plans. The following financial data are also available (1) The firm has estimated that its sales for 2016 will be $900,300 (2) The firm expects to pay $35,900 in cash dividends in 2016 (3) The firm wishes to maintain a minimum cash balance of $30,500 (4) Accounts receivable represent approximately 24% of annual sales (5) The firm's ending inventory will change directly with changes in sales in 2016 (6) A new machine costing $42,900 will be purchased in 2016. Total depreciation for 2016 will be $15,800 (7) Accounts payable will change directly in response to changes in sales in 2016 (8) Taxes payable will equal one-fourth of the tax liability on the pro forma income statement. (9) Marketable securities, other current liabilities, long-term debt, and common stock will remain unchangecd a. Prepare a pro forma income statement for the year ended December 31, 2016, using the percent-of-sales method b. Prepare a pro forma balance sheet dated December 31, 2016, using the judgmental approach c. Analyze these statements, and discuss the resulting external financing required a. Prepare a pro forma income statement for the year ended December 31, 2016, using the percent-of-sales method Complete the pro forma income statement for the year ended December 31, 2016 below: (Round to the nearest dollar. Round the percentage of sales to four decimal places.) Pro Forma Income Statement Red Queen Restaurants for the Year Ended December 31, 2016 (percent-of-sales method) 900,300 Sales Less: Cost of goods sold Gross profits Less: Operating expenses Net profits before taxes Less: Taxes (rate-40%) Net profits after taxes Less: Cash dividends To Retained earnings 749975 % 12.4562 % 35,900