The Optical Scam Company has forecast a sales growth rate of 20 percent for next year. Current assets,fixed assets, and short-term debt are proportional to sales.The current financial statements are shown here.

INCOME STATEMENT

Sales $32,200,000

Costs 27,743,800

Taxable income $4,456,200

Taxes 1,559,670

Net income $2,896,530

Dividends $1,158,612

Addition to retained earnings1,737,918

BALANCE SHEET

Assets Liabilities and Equity

Current assets $7,380,000 Short-term debt$7,084,000

Long-term debt4,958,800

Fixed assets18,058,00

Common stock$ 3,391,200

Accumulated retained earnings 10,004,000

Total equity $13,395,200

Total assets$25,438,000 Total liabilities and equity $25,438,000

a.Calculate the external funds needed for nest year using the equation from the chapter.

External financing needed $

b-1. Prepare the firm's pro forma balance sheet for next year

BALANCE SHEET

AssetsLiabilities and equity

Current assets $ Short-term debt$

Fixed assets Long-term debt

Common stock$

Accumulated retained earnings

Total equity$

Total assets$Total liabilities and equity$