QUESTION 4 (13 MARKS) Moose Tours, Inc. operated in full capacity during the year 2008. Moose's financial statements of the year 2008 are given below. 2008 Income Statement Sales $910.000 Costs 709,000 Other expenses 11.000 Earnings before interest and taxes $190.000 Interest paid 20.900 Taxable income $169.100 Taxes (34) 57.494 Net income $111.606 Dividends $44.642 Addition to retained earnings $66,964 Balance Sheet as of December 31, 2008 Assets Current assets Cash Accounts receivable Inventory Total Fixed assets Net plant and equipment $24,000 42,000 76.000 $142,000 Liabilities and Owners' Equity Current liabilities Accounts payable $66,000 Notes payable 10,000 Total $76,000 Long-term debt $142.000 Owners' equity Common stock and paid-in surplus $23,000 Retained earnings 268,000 Total $291,000 Total liabilities and owners' equity $509,000 $367,000 Total assets $509,000 At the beginning of the year 2009, the finance manager predicts that interest expense will remain constant; the tax rate and dividend pay-out rate will also remain constant. Sales for 2009 are projected to grow by 16 percent. Costs, other expenses, current assets, and accounts payable increase spontaneously with sales. The firm is operating at full capacity and no new debt or equity is issued. a) Prepare a pro forma income statement for the year 2009. (5 marks) b) Prepare a pro forma balance sheet for the year 2009. (6 marks) c) Determine how much external financing is needed to support the growth of sales? (2 marks)