The most recent balance sheet is as follow:

Cash 1,000,000 Accounts payable 700,000

Marketable securities 800,000 Notes Payable 2,000,000

Accounts receivable 1,200,000 Accruals 1,300,000

Inventory 2,000,000Current liabilities 4,000,000

Current Assets 5,000,000 Long-term debt 5,400,000

Common stock 4,600,000

Fixed assets 15,000,000 Retained earnings 6,000,000

Total assets 20,000,000Total liabilities and equity 20,000,000

The firm estimates sales will increase from $40 million to $50 million.The firm's profit margin is 5 percent, and its dividend payout ratio is 40 percent.The firm's fixed assets were used to only 96% of the capacity.

[1] First, calculate FA

[2] Using the AFN formula method, determine how much outside financing is required.

Expand the following equation by plugging numbers in the last term.

[3] Using the Pro forma statement method, determine how much outside financing is required.Plug numbers in the pro forma statement in below.

Cash

Accounts payable

Marketable securities

Notes Payable

Accounts receivable

Accruals

Inventory

Current liabilities

Current Assets

Long-term debt

Common stock

Fixed assets

Retained earnings

Total assets

Total liabilities and equity

AFN=EFN

Show all calculations in below.