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A firm is currently operating at 8 4 percent of capacity. Annual sales are $ 2 8 , 4 0 0 and net income is
A firm is currently operating at percent of capacity. Annual sales are $ and net income is $ The firm has current liabilities of $ longterm debt of $ net fixed assets of $ net working capital of $ and owners' equity of $ All costs and net working capital vary directly with sales. The tax rate and net profit margin will remain constant. The dividend payout ratio is constant at percent. Sales are projected to increase by percent and no new equity is expected to raised.
How much additional debt is required?
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