A$.$ Prepare a pro forma income statement for next$$ year, using the $$percent$-$of$-$sales method.

b$.$ Prepare a pro forma balance sheet for next$$ year, using the judgmental approach.

c$.$ Analyze these$$ statements, and discuss the resulting external financing required.ro forma statements$$Red Queen Restaurants wishes to prepare financial plans. Use the financial statements and the other information provided here below... to prepare the financial plans. The following financial data are also available for next$$ year:

$(1)$ The firm has estimated that its sales will be $ $900$ comma $700.$

$(2)$ The firm expects to pay $ $35$ comma $000$ in cash dividends.

$(3)$ The firm wishes to maintain a minimum cash balance of $ $32$ comma $000.$

$(4)$ Accounts receivable represent approximately $22\%$ of annual sales.

$(5)$ The$$ firm's ending inventory will change directly with changes in sales.

$(6)$ Red Queen will purchase new machine costing $ $42$ comma $400$ and have total depreciation of $ $15$ comma $800.$

$(7)$ Accounts payable will change directly in response to changes in sales.

$(8)$ Taxes payable will equal$$ one$-$fourth of the tax liability on the pro forma income statement.

$(9)$ Marketable$$ securities$,$ other current$$ liabilities, long$-$term$$ debt, and common stock will remain unchanged. Here is additional information for below $"$ Red Queen Restaurants Income Statement

for the Year Ended December $31,2019$

Sales revenue $$799,300$

Less: Cost of goods sold $600,900$

Gross profits $$198,400$

Less: Operating expenses $100,700$

Net profits before taxes $$97,700$

Less: Taxes $(40\%)39,080$

Net profits after taxes $$58,620$

Less: Cash dividends $20,300$

To retained earnings $$38,320$ and Assets Liabilities and Stockholders' Equity

Cash $$32,700$ Accounts payable $$100,600$

Marketable securities $17,000$ Taxes payable $20,900$

Accounts receivable $150,200$ Other current liabilities $4,000$

Inventories $99,000$ Total current liabilities $$125,500$

Total current assets $$298,900$ Long$-$term debt $$199,600$

Net fixed assets $350,900$ Common stock $$149,700$

Retained earnings $$175,000$

Total assets $$649,800$ Total liabilities and equity $$649,800$