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Eagle Sports Supply has the following financial statements. Assume that Eagle s assets are proportional to its sales. INCOME STATEMENT, 2017 Sales ...................................... $950 Costs ........................................ 250 Interest ...................................... 50 Taxes ....................................... 150 Net income .............................. $500 a. Find Eagle s required external funds if it maintains a dividend payout ratio of 70% and plans a growth rate of 15% in 2018. b. If Eagle chooses not to issue new shares of stock, what variable must be the balancing item? c. What will be the value of this balancing item?
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