You are the most creative analyst for Spotted Skunk Soft Drink Company, and your admirers want to see you work your analytical magic once more. This Year's Actual Results Next Year's Initial Forecast $17,000,000 $20,060,000 Net sales 13,600,000 16,048,000 $3,400,000 850,000 $4,012,000 $ 850,000 340,000 401,200 Cost of goods sold Gross profit Fixed operating costs except depreciation Depreciation Earnings before interest and taxes Interest Earnings before taxes Taxes $2,210,000 $ $2,607,800 340,000 340,000 $1,870,000 $2,267,800 907,120 748,000 Net income $1,122,000 $1,360,680 Common dividends 605,880 605,880 Addition to retained earnings $516,120 $754,800 $0.22 $0.27 Earnings per share Dividends per share Number of common shares (millions) $0.12 $0.12 5.00 5.00 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 forecasted Increase in net sales is 18.00%. No additional external financing will be required. The facility is currently operating at full capacity. The assigned depreciation method has changed. Which of the following could be a direct cause of financing feedback? Check all that apply. 0 Repaying outstanding bonds O Borrowing from the bank Issuing additional common stock Purchasing additional buildings with internally generated funds What is one of the potential consequences of financing feedback that might cause the actual financing needs to be higher than initially thought? Financing feedback might: O Spontaneously increase liabilities associated with the cost of goods sold Increase charges against net income, reducing the amount of available internally generated funds O Increase the length of the operating cycle O Reduce the level of cash on hand