4. More on the Additional Funds Needed (AFN) equation Cold Duck Manufacturing Inc. reported sales of $720,000 at the end of last year, but this year, sales are expected to grow by 7%. Cold Duck expects to maintain its current profit margin of 20% and dividend paryout ratio of 30%. The following information was taken from Cold Duck's balance sheet: Based on the AFIN equation, the firm's AFN for the cument year is A negatively-signed AFN value represents a point at which the funds generated within the firm equal the dernands for funds to finance the firm's future expected sales requifementi. a shortage of internally generated funds that inust be raised outside the company to finance the company's farecasted future growth. a surplus of internally generated funds that can be invested in physical or financial assets or paid out a5 additional dividends. Because of its excess funds, Cold Duck is thinking about raising its dividend payout ratio to satidy shareholders. What percentage of its earnings can Cold Duck bay to shareholders without needing to reise any external capital? (Hint: What can Cold Duck increase: its dividend payout ratio to before the AFN becomes positive?) 84,3 632 Based on the AFN equation, the firm's AFN for the current year is A negatively-rigned AFN value represents a point at which the funds generated within the firm equal the demands for funds co finance the firmis future expected sales requirements. a shortage of internally generated funds that must be raised outside the corpany to cinance the companys forccasted future growth. a surplus of intemally generated funds that can be invested in physical or financhal assets or paid out as adaitional dividends. Becaute of its excess funds. Cold Duck is thinking about raising its dividend pavou rotio to satidy shareholdery. What Dercentage of its earnings can Cold Oucir pay to sharuholderi without needing to faise any axternal capitalf (Winti what can Cold buck increase its dividend payoct ratio to before the Af becomes positive? 63.2 7:.7 59.0