Question
Eagle Sports Supply has the following financial statements. Assume that Eagles assets are proportional to its sales. INCOME STATEMENT, 2022 Sales $ 950 Costs 250
Eagle Sports Supply has the following financial statements. Assume that Eagles assets are proportional to its sales. INCOME STATEMENT, 2022 Sales $ 950 Costs 250 Interest 50 Taxes 150 Net income $ 500 BALANCE SHEET, YEAR-END 2021 2022 2021 2022 Assets $ 2,700 $ 3,000 Debt $ 900 $ 1,000 Equity 1,800 2,000 Total $ 2,700 $ 3,000 Total $ 2,700 $ 3,000 Find Eagles required external funds if it maintains a dividend payout ratio of 70% and plans a growth rate of 15% in 2023. Note: Do not round intermediate calculations. Round your answer to 2 decimal places. If Eagle chooses not to issue new shares of stock, what variable must be the balancing item? What will be the value of this balancing item? Note: Do not round intermediate calculations. Round your answer to 2 decimal places. Now suppose that the firm plans instead to increase long-term debt only to $1,100 and does not wish to issue any new shares of stock. What is now the balancing item? What will be the value of this new balancing item? Note: Do not round intermediate calculations. Round your answer to the nearest whole number.
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