The Longbranch Western Wear Company has the following financial statements, which are representative of the company's historical average Income Statement Sales Expenses Earnings before interest and taxes Interest Earnings before taxes Taxes Earnings after taxes Dividends $250,000 188,300 $ 61,700 3,200 $ 58,500 21,000 $ 37, see $ 11,25e Balance Sheet Liabilities and Shareholders' Equity Assets Cash Accounts receivable Inventory Current assets Capital assets $6,000 22,800 27, eee $55,000 82,eee Accounts payable Accrued wages Accrued taxes Current liabilities Notes payable Long-tern debt Common stock Retained earnings Total liabilities and equity $11,200 2,400 11,400 $25,eee 8,200 21,000 32, eee 52,800 $137,000 Total assets $137,000 Prey 1 of 4 SU BE 28 Next > Longbranch is expecting a 30 percent increase in sales next year, and management is concerned about the company's need for external funds. The increase in sales is expected to be carried out without any expansion of capital assets; Instead, it will be done through more efficient asset utilization in the existing stores of labilitles, only current liabilitles vary directly with sales. a. Using a percent-of-sales method, determine whether Longbranch Western Wear has external financing needs. (input the amount as a positive value.) The firm noods in external funds b. Prepare a pro forma balance sheet with any financing adjustment made to notes payable and excess, if any, shall reduce long term debt. (Input all answers as positive values. Be sure to list the assets and liabilities in order of their liquidity. Do not leave any empty spaces: Input a O wherever it is required.) Balance Sheet Liabilities $ Current assets (Click to select) (Click to select) (Click to select) (Click to select) (Click to select) (Click to select) $ $ Current assets (Click to select) $ Current liabilities (Click to select) Click to select) (Click to select) (Click to select) Balance Sheet Liabilities V $ V $ Current assets (Click to select) (Click to select) (Click to select) V (Click to select) (Click to select) (Click to select) v $ $ Current assets (Click to select) Current liabilities (Click to select) (Click to select) (Click to select) (Click to select) $ V $ $ Total assets Total liabilities and equity c. Calculate the current ratio and total debt to assets ratio for each year. (Round the final answers to 2 decimal places.) Year 1 Year 2 Current ratio Total debt/ assets %