Long$-$Term Financing Needed

At year$-$end $2021,$ Wallace Landscaping's total assets, all of which are used in operations, were $$2\mathrm{.}18$ million, and its accounts payable were

$$400,000.$ Sales, which in $2021$ were $$2\mathrm{.}1$ million, are expected to increase by $25\%$ in $2022.$ Total assets and accounts payable are proportional

to sales, and that relationship will be maintained. Wallace typically uses no current liabilities other than accounts payable. Common stock

amounted to $$535,000$ in $2021,$ and retained earnings were $$390,000.$ Wallace has arranged to sell $$200,000$ of new common stock in $2022$ to

meet some of its financing needs. The remainder of its financing needs will be met by issuing new long$-$term debt at the end of $2022.($Because

the debt is added at the end of the year, there will be no additional interest expense due to the new debt.$)$ Its net profit margin on sales is $6\%,$

and $55\%$ of earnings will be paid out as dividends.

a$.$ What was Wallace's total long$-$term debt in $2021?$ Do not round intermediate calculations. Enter your answer in dollars. For example, an

answer of $$2$ million should be entered as $2,000,000.$ Round your answer to the nearest dollar.

$

What were Wallace's total liabilities in $2021?$ Do not round intermediate calculations. Enter your answer in dollars. For example, an answer of

$$2$ million should be entered as $2,000,000.$ Round your answer to the nearest dollar.

$

b$.$ How much new long$-$term debt financing will be needed in $2022?($Hint: AFN $-$ New stock $=$ New long$-$term debt.$)$ Do not round intermediate

calculations. Enter your answer in dollars. For example, an answer of $$2$ million should be entered as $2,000,000.$ Round your answer to the

nearest dollar.