Pro forma balance sheetBasic Leonard Industries wishes to prepare a pro forma balance sheet for December 31, 2020. The firm expects 2020 sales to total $3,000,000. The following information has been gathered.

(1) A minimum cash balance of $50,100 is desired.

(2) Marketable securities are expected to remain unchanged.

(3) Accounts receivable represent 9.8% of sales.

(4) Inventories represent 11.9% of sales

(5) A new machine costing $89,600 will be acquired during 2020. Total depreciation for the year will be $31,600.

(6) Accounts payable represent 14.4% of sales.

(7) Accruals, other current liabilities, long-term debt, and common stock are expected to remain unchanged.

(8) The firm's net profit margin is 4.2%, and it expects to pay out $69,700 in cash dividends during 2020.

(9) The December 31, 2019, balance sheet follows

a. Use the judgmental approach to prepare a pro forma balance sheet dated December 31, 2020, for Leonard Industries.

b. How much, if any, additional financing will Leonard Industries require in 2020? Discuss.

c. Could Leonard Industries adjust its planned 2020 dividend to avoid the situation described in part b? Explain how.

& Cash Marketable securities Accounts receivable Inventories Total current assets Net fixed assets $45,400 14,800 254,700 340,000 $654,900 600,000 LIANITTLICS anu LUNIIUIUCIS Lyurly Accounts payable Accruals Other current liabilities Total current liabilities Long-term debt Common stock Retained earnings Total liabilities and stockholders' equity $395,300 59,700 30,400 $485,400 349.100 200,000 220,400 $1,254.900 Total assets $1,254.900 Total assets $ & Cash Marketable securities Accounts receivable Inventories Total current assets Net fixed assets $45,400 14,800 254,700 340,000 $654,900 600,000 LIANITTLICS anu LUNIIUIUCIS Lyurly Accounts payable Accruals Other current liabilities Total current liabilities Long-term debt Common stock Retained earnings Total liabilities and stockholders' equity $395,300 59,700 30,400 $485,400 349.100 200,000 220,400 $1,254.900 Total assets $1,254.900 Total assets $