Leonard Industries Balance Sheet December 31, 2019 Assets Liabilities and Stockholders' Equity Cash $396,000 Accounts payable Marketable securities 203,000 Accruals Accounts receivable 1,205,000 Other current liabilities Inventories 1,801,000 Total current liabilities Total current assets $3,605,000 Long-term debt Net fixed assets 4,001,000 Common stock Total liabilities and Total assets $7,606,000 stockholders' equity $1,397,000 402,000 80,100 $1,879,100 2,002,900 3,724,000 $7,606,000 Leonard Industries Balance Sheet December 31, 2019 Assets Liabilities and Stockholders' Equity Cash $396,000 Accounts payable Marketable securities 203,000 Accruals Accounts receivable 1,205,000 Other current liabilities Inventories 1,801,000 Total current liabilities Total current assets $3,605,000 Long-term debt Net fixed assets 4,001,000 Common stock Total liabilities and Total assets $7,606,000 stockholders' equity $1,397,000 402,000 80 100 $1,879,100 2,002,900 3,724.000 $7,606,000 Pro forma balance sheet Peabody & Peabody has 2019 sales of $10.4 million. It wishes to analyze expected performance and financing needs for 2021-2 years ahead. Given the following information, respond to parts a. and b. (1) The percents of sales for items that vary directly with sales are as follows: Accounts receivable; 12.1%, Inventory: 18.5%; Accounts payable, 13.5%; Net profit margin. 2.7%. (2) Marketable securities and other current liabilities are expected to remain unchanged. (3) A minimum cash balance of $478,000 is desired (4) A new machine costing $655,000 will be acquired in 2020, and equipment costing $850,000 will be purchased in 2021. Total depreciation in 2020 is forecast as $295,000, and in 2021 $385,000 of depreciation will be taken (5) Accruals are expected to rise to $498,000 by the end of 2021 (6) No sale or retirement of long-term debt is expected. (7) No sale or repurchase of common stock is expected (8) The dividend payout of 50% of net profits is expected to continue (9) Sales are expected to be $11.5 million in 2020 and $11.6 million in 2021 (10) The December 31, 2019, balance sheet is here ! a. Prepare a pro forma balance sheet dated December 31, 2021. b. Discuss the financing changes suggested by the statement prepared in part (a). a. Prepare a pro forma balance sheet dated December 31, 2021 Complete the assets part of the pro forma balance sheet for Peabody & Peabody for December 31, 2021 below. (Round to the nearest dollar.) Pro Forma Balance Sheet Peabody & Peabody December 31, 2021 Assets Current assets Cash Marketable securities Accounts receivable Inventories Total current assets Net fixed assets Total assets Complete the liabilities and stockholders' equity part of the pro forma balance sheet for Peabody & Peabody for December 31, 2021 below. (Round to the nearest dollar) Pro Forma Balance Sheet Peabody & Peabody December 31, 2021 Liabilities and stockholders' equity Current liabilities Accounts payable Accruals Other current liabilities Total current liabilities Long-term debt Total liabilities Common stock and Retained Earnings $ External funds required $ Total liabilities and stockholders' equity $ b. Discuss the financing changes suggested by the statement prepared in part (a). (Select all the answers that apply.) A. If financing cannot be obtained, one or more of the constraints must be changed. B. Peabody & Peabody must arrange for additional financing of at least $873,750 over the next two years based on the given constraints and projections OC. Peabody & Peabody's retained earnings are enough to cover all of the company's desired level of certain accounts. OD. Peabody & Peabody must arrange for additional financing of at least $878,750 over the next two years based on the given constraints and projections. Leonard Industries Balance Sheet December 31, 2019 Assets Liabilities and Stockholders' Equity Cash $396,000 Accounts payable Marketable securities 203,000 Accruals Accounts receivable 1,205,000 Other current liabilities Inventories 1,801,000 Total current liabilities Total current assets $3,605,000 Long-term debt Net fixed assets 4,001,000 Common stock Total liabilities and Total assets $7,606,000 stockholders' equity $1,397,000 402,000 80,100 $1,879,100 2,002,900 3,724,000 $7,606,000 Leonard Industries Balance Sheet December 31, 2019 Assets Liabilities and Stockholders' Equity Cash $396,000 Accounts payable Marketable securities 203,000 Accruals Accounts receivable 1,205,000 Other current liabilities Inventories 1,801,000 Total current liabilities Total current assets $3,605,000 Long-term debt Net fixed assets 4,001,000 Common stock Total liabilities and Total assets $7,606,000 stockholders' equity $1,397,000 402,000 80 100 $1,879,100 2,002,900 3,724.000 $7,606,000 Pro forma balance sheet Peabody & Peabody has 2019 sales of $10.4 million. It wishes to analyze expected performance and financing needs for 2021-2 years ahead. Given the following information, respond to parts a. and b. (1) The percents of sales for items that vary directly with sales are as follows: Accounts receivable; 12.1%, Inventory: 18.5%; Accounts payable, 13.5%; Net profit margin. 2.7%. (2) Marketable securities and other current liabilities are expected to remain unchanged. (3) A minimum cash balance of $478,000 is desired (4) A new machine costing $655,000 will be acquired in 2020, and equipment costing $850,000 will be purchased in 2021. Total depreciation in 2020 is forecast as $295,000, and in 2021 $385,000 of depreciation will be taken (5) Accruals are expected to rise to $498,000 by the end of 2021 (6) No sale or retirement of long-term debt is expected. (7) No sale or repurchase of common stock is expected (8) The dividend payout of 50% of net profits is expected to continue (9) Sales are expected to be $11.5 million in 2020 and $11.6 million in 2021 (10) The December 31, 2019, balance sheet is here ! a. Prepare a pro forma balance sheet dated December 31, 2021. b. Discuss the financing changes suggested by the statement prepared in part (a). a. Prepare a pro forma balance sheet dated December 31, 2021 Complete the assets part of the pro forma balance sheet for Peabody & Peabody for December 31, 2021 below. (Round to the nearest dollar.) Pro Forma Balance Sheet Peabody & Peabody December 31, 2021 Assets Current assets Cash Marketable securities Accounts receivable Inventories Total current assets Net fixed assets Total assets Complete the liabilities and stockholders' equity part of the pro forma balance sheet for Peabody & Peabody for December 31, 2021 below. (Round to the nearest dollar) Pro Forma Balance Sheet Peabody & Peabody December 31, 2021 Liabilities and stockholders' equity Current liabilities Accounts payable Accruals Other current liabilities Total current liabilities Long-term debt Total liabilities Common stock and Retained Earnings $ External funds required $ Total liabilities and stockholders' equity $ b. Discuss the financing changes suggested by the statement prepared in part (a). (Select all the answers that apply.) A. If financing cannot be obtained, one or more of the constraints must be changed. B. Peabody & Peabody must arrange for additional financing of at least $873,750 over the next two years based on the given constraints and projections OC. Peabody & Peabody's retained earnings are enough to cover all of the company's desired level of certain accounts. OD. Peabody & Peabody must arrange for additional financing of at least $878,750 over the next two years based on the given constraints and projections