Prepare the income statement and balance sheet for next year using the Percentage of Sales Forecasting Method. Show all work and calculations. Sales are expected to grow to $1,800,000 next year. The firm will pay out 50% of its net income as dividends next year. Any net new financing will be derived from issuing additional common stock.

Income Statement: Current Sales Costs except Depr. EBITDA Depreciation EBIT Interest Expense (net) Pretax Income Income Tax Net Income 1,500,000 (800,000) 700,000 (150,000) 550,000 (50,000) 500,000 (200,000) 300,000 Balance Sheet Current Assets Cash and Equivalents Accounts Receivable Inventories Total Current Assets Property Plant and Equipment Total Assets 1,200,000 800,000 400,000 2,400,000 1,800,000 4,200,000 Liabilities and Equity Accounts Payable Debt Total Liabilities Stockholders' Equit Total Liabilities and Equity 1,500,000 500,000 2,000,000 2,200,000 4,200,000