Problem A please!

12-2 Noso Textile's 2005 financial statements are shown here SO TEXTILE: BALANCE SHEET AS OF DECEMBER 31, 2005 Cash Inventories Net fixed assets S1,080 Accounts payable 4,320 2,880 6,480 Accruals 9,000 Notes payable Current assets $16,560 12,600 Current liabilities Long-term bonds Common stock Retained earnings 9,300 3,500 3,500 12,860 Total liabilities and equity $29,160 Total assets S29,160 Noso TEXTILE: INCOME STATEMENT FOR DECEMBER 31, 2005 (S THOUSANDS) Sales Operating costs Earnings before interest and taxes Interest Earnings before taxes Taxes (40%) Net Income Dividends (45%) Addition to retained earnings $36,000 32.440 3,560 560 S 3,000 1.200 1.800 810 $ 990 a. Suppose 2006 sales are projected to increase by 15 percent over 2005 sales. Determine the additional funds needed. Assume that the company was operating at full capacity in 2005, that it cannot sell off any of its fixed assets, and that any required financing will be borrowed as notes payable. Also, assume that assets, spontaneous liabilities, and operating costs are expected to increase by the same balance sheet method to develop a pro forma balance sheet and income statement for December 31, 2006. (Do not incorporate any financing feedback effects. Use the pro forma income statement to determine the addition to retained earnings.) percentage as sales. Use the projected