BeauportInc. a prominent consumer productsfirmis debating whether toconvert its allequity capital structure to one that is 30 percent debt. Currently,

there are 7,000 shares outstanding, and the price per share is $55. EBIT is

expected to remain at $27,000

per year forever. The interest rate on new debt is

8 percent, and there are no taxes. Danny, a shareholder of the firm, owns 100

share of stock. What is his cash flow under the current capital structure,

assuming the firm has a dividend payout rate of 100

percent?

*If anyone could point me in the right direction on how to solve this it would be really helpful..