Lab $4$ Chapter $4($i$)$

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Longbranch is expecting a $25$ percent increase in sales next year, and management is concerned about the company's need for external funds. The increase in sales is expected to be carried out without any expansion of capital assets; instead, it will be done through more efficient asset utilization in the existing stores. Of liabilities, only current liabilities vary directly with sales.

a$.$ Using a percent$-$of$-$sales method, determine whether Longbranch Western Wear has external financing needs. $($Input the amount as a positive value.$)$

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b$.$ Prepare a pro forma balance sheet with any financing adjustment made to notes payable and excess, if any, shall reduce long term debt. $($Input all answers as positive values. Be sure to list the assets and liabilities in order of their liquidity. Do not leave any empty spaces; input a $0$ wherever it is required.$)$