6. Projected financial statements and basic analysis Aa Aa E You are the most creative analyst for Green Rabbit Transportation Inc., and your admirers want to see you work your analytical magic once more. 2016 Actual Results 2017 Initial Forecast Earnings before taxes Number of common shares (millions) Net income Gross profit Earnings per share Earnings before interest and taxes Net sales Depreciation Dividends per share Taxes Addition to retained earnings Interest Cost of goods sold Common dividends Fixed operating costs except depreciation $1,980 20.0 $1,188 $3,600 $59 $2,340 $18,000 (360) $32 (792) $546 (360) (14,400) $2,448 20.0 1,469 $4,320 $73 $2,808 $21,600 (432) $32 (979) $827 (360) (17,280) (642) (1,080) (642) (900) Which of the following are assumptions made by the initial income statement forecast? Check all that apply. The facility is not currently operating at full capacity. The assigned depreciation method has changed. No additional external financing will be required. The forecasted increase in net sales is 20%. Additional external financing will be required by Green Rabbit Transportation Inc. The facility is currently operating at full capacity. If Green Rabbit Transportation Inc. had neither a sufficient amount of excess capacity to handle forecasted increases in operations nor the level of retained earnings required to increase asset levels up to the necessary level for production, this difference would be referred to as and could be acquired in which of the following forms? additional funds needed alternative fiduciary necessities added fair needs I. Issuing additional common stock additional financing needed II. Borrowing from a bank using notes payable III. Issuing long-term bonds O O O O O O Just III II and III I, II, and III Just II I and II I only