The Paper Mill is operating at full capacity. Assets, costs, and current liabilities vary directly with sales. The dividend payout ratio is constant Dividends were paid in the prior year in the amount of $1,925. Following, are the company's prior year financial statements: 1 Income Statement 2 Sales 42,700.00 3 Costs 37,200.00 14 Net Income 5,500.00 15 16 Balance Sheet 17 Current Assets 7,900.00 Current Liabilities 3,650.00 18 Fixed Assets 41,000.00 Long-Term Debt 18,100.00 19 Equity 27,150.00 20 21 Total Assets 48,900.00 48,900.00 22 23 Answer the following questions related to the above information about The Paper Mill. 24 25 Question 1 Assuming sales are projected to increase by 14%, prepare pro forma financial statements 26 and determine the external financing needed. 27 28 Question 2 Using the original information given, compute the internal and sustainable growth rates for 29 The Paper Mill. 30 31 Question 3 Consider the initial information given and assume that the company is operating at only 32 85% of capacity rather than full capacity. Determine the full capacity sales. Then determine