A firm has estimated earnings of $120,000 and estimated capital spending of $90,000. Currently the firm has $180,000 in equity and a debt-equity ratio of .80. Which one of the following statements is true if the firm changes its capital structure to a debt-equity ratio of 1.0? A.The dividend amount will increase if the firm follows a strict residual dividend policy. B.The dividend amount will not be affected if the firm follows a strict residual dividend policy. C.The amount of capital spending that can occur without issuing more equity securities will decrease. D.The firm will need to borrow $60,000 to achieve the new debt- equity ratio. E.The firm will need to borrow $24,000 to achieve the new debt- equity ratio.