The balance sheet of the Thompson Trucking Company (TTC) follows: TTC has sales for the year ended 12/31/2013 of 49.46 million. The firm follows a policy of paying all the earnings out to its common sotckholders in cash dividends. Thus, TTC generated no funds from its earnings that can be used to expand its operations. (Assume that the deprciation expense is just equal to the cost of replacing worn-out assts.). Hint: Make sure to round all intermediate calculations to at least five decimal places.

A. If TTC anticipates sales of 81.72 million during the coming year, develop a pro forma balance sheet for the firm for 12/31/201. Assume the current assets vary as a percent of sales, net fixed assets remain unchanges, and the accounts payable bary as a percent of sales. Use notes payable as a balancing entry.

B. How much "new" financing will TTC need next year?

C. What limitation does the percent-of-sales forecast method suffer from? Discuss briefly

Thompson Trucking Company Balance Sheet, December 31, 2010
Current Assets	$9.34	Accounts Payable	$5.16
Net Fixed Assets	$15.01	Notes Payable	0.00
Total	$24.35	Bonds Payable	$10.94
		Common Equity	$8.25
		Total	$24.35