The Longbranch Western Wear Company has the following financial statements, which are representative of the company's historical average. Income Statement Sales $200,000 Expenses... 158,000 Earnings before interest and taxes 42,000 Interest 2,000 Earnings before taxes.. 40,000 Taxes. 20,000 Earnings after taxes. $ 20,000 Dividends $ 10,000 Assets Cash Accounts receivable. Inventory Current assets. Capital assets Balance Sheet Liabilities and Shareholders' Equity $ 3.000 Accounts payable S 5.000 10.000 Accrued wages 1,000 15,000 Accrued taxes. 2,000 30.000 Current liabilities 8,000 70,000 Notes payable 7,000 Long-term debt 15.000 Common stock 20.000 Retained earnings 50.000 $100,000 Total liabilities and equity S100.000 Total assets Longbranch is expecting a 20 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 liabilities, only current liabilities vary directly with sales. (Refer to the example in the chapter and show all calculations), a. Using a percent-of-sales method, determine whether Longbranch Western Wear has external financing needs