Pro forma balance sheet Peabody & Peabody has $2022$ sales of $$10\mathrm{.}5$ million. It wishes to analyze expected performance and financing needs for $2024-2$ 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; $11\mathrm{.}8\%,$ Inventory; $18\mathrm{.}2\%$; Accounts payable, $142\%$; Net profit margin, $3\mathrm{.}5\%.$

$(2)$ Marketable securities and other current liabilities will remain unchanged.

$(3)$ Peabody desires a minimum cash balance of $$476,000$

$(4)$ A new machine costing $$645,000$ will be acquired in $2023,$ and equipment costing $$855,000$ will be purchased in $2024.$ Total depreciation in $2023$ is forecast as $$293,000,$ and in $2024$$$386,000$ of depreciation will be taken

$(5)$ Accruals will rise to $$500,000$ by the end of $2024$

$(6)$ There will be no sale or retirement of long$-$term debt.

$(7)$ No sale or repurchase of common stock is expected.

$(8)$ The dividend payout of $50\%$ of net profits will continue.

$(9)$ The sales forecast predicts $$11\mathrm{.}6$ million in $2023$ and $$11\mathrm{.}3$ million in $2024.$

$(10)$ The December $31,2022,$ balance sheet is here $.$

a$.$ Prepare a pro forma balance sheet dated December $31,2024$

b$.$ Discuss the financing changes suggested by the statement prepared in part $($a$)$

Data table

$($Click on the icon here or$.$ in erder to copy the contents of the data table below into a spreadsheet$)$

Peabody & Peabody Balance Sheet December $31,202.$

$\backslash$table$[[$Assets$,,$Liabilities and Stockhold,$],[$Cath$,$$$396\mathrm{.}000,$Accounts payable,$$1,404,000$