Pro forma balancesheetBasic Leonard Industries wishes to prepare a pro forma balance sheet for next year. The firm expects sales to total $3,000,000.

The following information has been gathered.

(1) A minimum cash balance of $50,000 is desired.

(2) Marketable securities will remain unchanged.

(3) Accounts receivable represen 10.2% of sales.

(4) Inventories represent 12.3% of sales.

(5) Leonard will acquire a new machine costing $89,900. Total depreciation for the year will be $31,500.

(6) Accounts payable represent 14.4% of sales.

(7) Accruals, other current liabilities, long-term debt, and common stock will remain unchanged.

(8) The firm's net profit margin is 3.8%, and it expects to pay out $69,600 in cash dividends next year.

a. Use the judgmental approach to prepare a pro forma balance sheet for next year.

b. How much, if any, additional financing will Leonard Industries require? Discuss.

c. Could Leonard Industries adjust its planned dividend to avoid the situation described in part b?Explain how.

le - X i Data Table ex er (Click on the icon here e in order to copy the contents of the data table below into a spreadsheet.) Leonard Industries Balance Sheet Assets Liabilities and Stockholders' Equity Cash $45,000 Accounts payable Marketable securities 15,200 Accruals Accounts receivable 254,900 Other current liabilities Inventories 339,700 Total current liabilities Total current assets $654,800 Long-term debt Net fixed assets 600,100 Common stock Retained earnings Total assets $1,254,900 Total liabilities and stockholders' equity $395,500 60,400 30,300 $486,200 348,900 199,500 220,300 $1,254,900 Print Done d