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Financing Deficit Stevens Textile Corporation's 2018 financial statements are shown below: Balance Sheet as of December 31, 2018 (Thousands of Dollars) a. Suppose 2019 sales are projected to increase by 10% over 2018 sales. Use the forecasted financial statement method to a. Suppose 2019 sales are projected to increase by 10% over 2018 sales. Use the forecasted financial statement method to forecast a balance sheet and income statement for December 31, 2019. The interest rate on all debt is 9%, and cash earns no interest income. Assume that all additional debt in the form of a line of cred is added at th. end of the year, which means that you should base the forecasted interest expense on the balance of debt at the beginning of the year. Use the forecasted incorre statement to determine the addition to retained carnings. Assume that the company was operating at full capacity in 2018 , that it cannot sell off any of its fored assets. and that any required financing will be borrowed as notes payable. Also, assume that assets, spontaneous liablities, and operating costs are expected to increase by the same percentage as sales. Determine the additional funds needed. Do not round intermediate calculations. Pound your answers to the nearest doilar. Total assets: 5 AFN 5 b. What is the resulting total forecasted amount of the line of credit? Do not round intermediate calculations. Round your answer to the nearest dollar: c. In your answers to Parts a and b, you should not have charged any interent on the additional debt added during 2019 because it was assumed that the new debe was added at the end of the year. But now suppose that the new debt is added throughout the year, Dont do any calculations, but how would this change the answers to parts and b? If debt is added throughout the year rather than only at the end of the veac interest expense will be than in the profections of aart a. This would cause net income to be , the addition to retained earnings to be , and the AFN to be - Thus, you would have to new debt

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