Financing DeficitIncome Statement for December 31, 2019Balance Sheet as of December 31, 2019 Garlington Technologies Inc

Financing DeficitIncome Statement for December 31, 2019Balance Sheet as of December 31, 2019 Garlington Technologies Inc.'s 2019 financial statements are shown below:

Sales $4,000,000 Operating costs 3,200,000  EBIT $  800,000 Interest 120,000  Pre-tax earnings $  680,000 Taxes (25%) 170,000 Net income 510,000 Dividends $  190,000

Cash $   160,000   Accounts payable $   360,000 Receivables 360,000   Line of credit 0 Inventories 720,000   Accruals 200,000  Total CA $1,240,000    Total CL $   560,000 Fixed assets 4,000,000   Long-term bonds 1,000,000  Total Assets $5,240,000   Common stock 1,100,000       RE 2,580,000        Total L&E $5,240,000 Suppose that in 2020 sales increase to $4.2 million and that 2020 dividends will increase to $154,000. Forecast the financial statements using the forecasted financial statement method. Assume the firm operated at full capacity in 2019. The long-term bonds have an interest rate of 9%. New financing will be with a line of credit. Assume it will be added at the end of the year. Cash does not earn any interest income. Enter your answers as positive values. Do not round intermediate calculations. Round your answers to the nearest dollar.

Garlington Technologies Inc.

Pro Forma Income Statement

December 31, 2020 Sales   $   Operating costs   $   EBIT   $   Interest   $   Pre-tax earnings   $   Taxes (25%)   $   Net income   $   Dividends:   $   Addition to RE:   $  

Garlington Technologies Inc.

Pro Forma Balance Statement

December 31, 2020 Cash   $   Receivables   $   Inventories   $    Total current assets   $   Fixed assets   $    Total assets   $   Accounts payable   $   Line of credit   $   Accruals   $    Total current liabilities   $   LT bonds   $   Common stock   $   Retained earnings   $    Total L&E   $