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You are given below the 2005 vear end financial statements for your firm (in thousands) and have been asked to profect the firm's funding needs for 2006 . You mary make the followins assurnotions. when making vour forecast: 1. Sales are expected to increase by 20 percent over the coming year as they will increase to $12,000,000. 2. Operating costs are expected to decrease to 75 percent of sales. 3. The interest rate on all debt will remain at 10 percent for 2006 . 4. Thexes are expected to remain at 40 percent in 2006. 5. The firm expects to increase its dividend per share to 50.60 in 2006. 6. All current assets will increase proportionately with sales. 7. At the end of 2005, fixed assets (property plant and equipment) are being operated at only 80 percent of capacity (you may ignore depreciation). 8. Fixed assets are lumpy. If the firm must increase its fixed assets, it will do so by adding an amount equal to $2,500,000 (you may ignore depreciation). 9. Accounts payable and accruals will increase proportionately with sales. 0 . Notes payable will decrease to $500,000 at the start of 2006 . ven this information, do a "first pass" and determine the furm's additional funds needed (AFN) for 06. 2006 \begin{tabular}{|c|c|c|} \hline Inoome statomort (in Thoersands) & Year 2005 & Funtpans \\ \hline Sakes & $10,00000 & \\ \hline Operatino costs & 5.8 .00000 & \\ \hline Earnings before interest and taxes & $200000 & \\ \hline \begin{tabular}{l} Interest \\ In \end{tabular} & $25000 & \\ \hline Eamings before taxes & $1.760.00 & \\ \hline Taxes & $700.00 & \\ \hline Net income available to common stockholders & $.1.050.00 & \\ \hline Common dividends & $350.00 & \\ \hline \end{tabular} $655 $620 $725 $585 $690