Problem 4.1 Pro Forma Statements (LO1] Consider the following simplified financial statements for the Wims Corporation (assuming no income taxes): Income Statement Sales $40,000 Costs 34,160 Balance Sheet Assets $26.000 Debt Equity $ 7,000 19,000 Net income $ 5,840 Total $26.000 Total $26,000 The company has predicted a sales increase of 20 percent. It has predicted that every item on the balance sheet will increase by 20 percent as well. Create the pro forma statements and reconcile them. (Input all answers as positive values. Do not round intermediate calculations.) Create the pro forma statements and reconcile them. (Input all answers as positive values. Do not round intermediate calculations.) Assets Pro forma income statement Sales Costs Net income Pro forma balance sheet Debt Equity Total Total What is the plug variable? The plug variable is in the amount of