Plank’s Plants had net income of $10,000 on sales of $100,000 last year. The firm paid...
Plank’s Plants had net income of $10,000 on sales of $100,000 last year. The firm paid a dividend of $400. Total assets were $600,000, of which $300,000 was financed by debt.
a. What is the firm’s sustainable growth rate? (Do not round intermediate calculations. Enter your answer as a percent rounded to 1 decimal place.)
b. If the firm grows at its sustainable growth rate, how much debt will be issued next year? (Do not round intermediate calculations.)
c. What would be the maximum possible growth rate if the firm did not issue any debt next year? (Do not round intermediate calculations. Enter your answer as a percent rounded to 1 decimal place.)
Homework Answers
Given,
Net income = $ 10000
Sales = $ 100000
Dividend = $ 400
Total assets = $ 600000
Debt = $ 300000
Equity = total assets - debt
= $ 600000 - $ 300000 = $ 300000
Solution :-
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Plank’s Plants had net income of $10,000 on sales of $100,000
last year. The firm paid...
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I attempted and the system said I was wrong. where am
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