Homework Answers
a. Sustainable Growth Rate = ROE * (1 - Payout Ratio)
Sustainable Growth Rate = 11.70% * (1 - 0.26)
Sustainable Growth Rate = 8.658%
b. Ending Total Assets = (Current Equity + Debt) * (1 + Sustainable Growth Rate)
Ending Total Assets = (629700 + 430000) * (1 + 0.08658)
Ending Total Assets = $1151449
c.
Additional Debt = Ending Assets * DTA Ratio - Current Debt
Additional Debt = 1151449 * 0.405775 - 430000
Additional Debt = $37229
The Statement is True
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Please answer A-C. Homework: Chapter 18 Homework Save Score: 0 of 1 pt 9 of 11...
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Please answer A-C.
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this year and cost of goods sold of
$ 73 comma 900$73,900.
You forecast sales to increase to
$ 112 comma 500$112,500
next year. Using the percent of sales method, forecast next
year's cost of goods sold.
The Tax Cuts and Jobs Act of 2017 temporarily allows 100% bonus
depreciation (effectively expensing capital expenditures).
However, we will still include depreciation forecasting in this
chapter and in these problems in anticipation of...
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