Use the following information and the percent-of-sales method to Answer questions. Below is the 2019 year-end balance sheet for Banner, Inc. Sales for 2019 were $1,600,000 and are expected to be $2,000,000 during 2020. In addition, we know that Banner plans to pay $90,000 in 2020 dividends and expects projected net income of 4% of sales. (For consistency with the Answer selections provided, round your forecast percentages to two decimals.)

Banner, Inc. Balance Sheet

December 31, 2019

Assets

Current assets $890,000

Net fixed assets 1,000,000

Total $1,890,000

Liabilities and Owners Equity

Accounts payable $160,000

Accrued expenses 100,000

Notes payable 700,000

Long-term debt 300,000

Total liabilities 1,260,000

Common stock (plus paid-in capital) 360,000

Retained earnings 270,000

Common equity 630,000

Total $1,890,000

Banners projected current assets for 2020 are:

a. $1,500,000.

b. $1,000,000.

c. $1,120,000.

d. $1,260,000.