Use Table 1 and the following information on Company X to perform a pro-forma financial modeling using a percentage sales method, and answers the next questions. Note: When applying the percentage sales method, you should assume that the 2020 percentage values with respect to sales of the (i) costs except depreciation, (ii) depreciation, (iii) cash and equivalents, (iv) accounts receivable, (v) inventories, (vi) property, plant and equipment, and (vi) accounts payable will remain equal to those percentages of 2019. Sales in 2020 are expected to grow at a rate of 15%, with respect to the values of 2019. Assume also that the total values in 2020 of interest expense and debt will not change from its 2019 values; income tax will remain at 35% of the Pretax Income; and that Company X initially plans to payout 35% of its net income to its shareholders.

Table 1
Income Statement, 2019			Balance Sheet, 2019
Sales	755,000		Assets
Costs except Depr.	-350,000		Cash and Equivalents		150,600
EBITDA	405,000		Accounts Receivable		100,000
Depreciation	-1,090		Inventories		10,000
EBIT	403,910		Total Current Assets		260,600
Interest Expense (net)	-100,500		Property Plant & Equipment		219,000
Pretax Income	303,410		Total Assets		479,600
Income Tax	-106,194		Liabilities &Equity
Net Income	197,217		Accounts Payable		100,000
			Debt		100,000
			Total Liabilities		200,000
			Stockholders' Equity		279,600
			Total Liabilities and Equity		479,600

QUESTION 8

1. "Before making additional balancing adjustments to the Balance Sheet, what is the forecasted value of Shareholder's Equity for 2020? Express the numerical terms of your answer completely. For example: If your answer is one million dollars, write: 1000000."

10 points

QUESTION 9

1. "What is the estimate for Net New Financing for 2020? Note: Make sure you use the correct positive or negative sign. Express the numerical terms of your answer completely. For example: If your answer is one million dollars, write: 1000000."

10 points

QUESTION 10

1. What option can the financial managers of Company X implement in order to balance Total Assets and Total Liabilities and Equity for 2020?

   		Increase the debt by the absolute value of the amount indicated in your calculations of net new financing;
   		Increase dividends by the absolute value of the amount indicated in your calculations of net new financing;
   		Either of a. or b. would work;
   		Neither of a. or b. would work;