Major Manuscripts, Inc. 2012 Income Statement
Net sales	$	7,500
Cost of goods sold		6,600
Depreciation		200
Earnings before interest and taxes	$	700
Interest paid		51
Taxable Income	$	649
Taxes		225
Net income	$	424
Dividends	$	189

Major Manuscripts, Inc. 2012 Balance Sheet
	2012				2012
Cash	$	2,310		Accounts payable	$	1,490
Accounts rec.		850		Long-term debt		340
Inventory		2,250		Common stock	$	2,400
Total	$	5,410		Retained earnings		4,470
Net fixed assets		3,290
Total assets	$	8,700		Total liabilities & equity	$	8,700

Major Manuscripts, Inc., is currently operating at 80 percent of capacity. All costs and net working capital vary directly with sales. The tax rate, the profit margin, and the dividend payout ratio will remain constant. How much additional debt is required if no new equity is raised and sales are projected to increase by 10 percent?

A) $149

B) $283

C) $134

D) $541

E) $259