9. Last year, a firm had a ROA of 14.5 percent and a dividend payout ratio...

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Finance

9. Last year, a firm had a ROA of 14.5 percent and a dividendpayout ratio of 35 percent. What is the firm’s
internal growth rate?
A. 33.33%
B. 25.40%
C. 19.05%
D. 13.64%
E. 10.41%

10. In 2014, Umbrellas Unlimited, Inc. had an ROE of 18.5 percentand a dividend payout ratio of 40 percent.
What is the sustainable growth rate?
A. 19.76%
B. 13.17%
C. 12.49%
D. 10.99%
E. 10.12%
14. In 2015, Burgundy Shoes, Inc. had net income of $313,125,sales of $1.95 million, and debt of $780,000.
Suppose the firm has total assets of $2.45 million and a dividendpayout ratio of 42%. What is the sustainable
growth rate?

A. 19.8%
B. 17.5%
C. 15.1%
D. 13.9%
E. 12.2%

15. You have located the following information on Clay PotsCompany: debt ratio = 36%, capital intensity ratio =
1.60 times, profit margin = 11.5%, and dividend payout ratio = 25%.What is the sustainable growth rate for
Clay Pots?
A. 9.89%
B. 9.20%
C. 8.15%
D. 6.83%
E. 7.56%

Answer & Explanation Solved by verified expert

3.9 Ratings (397 Votes)

Answer to Question 9 The correct answer is E ie 1041 Retention ratio b 1 Dividend payout ratio Retention ratio b 1 035 Retention ratio b 065 Internal Growth Rate ROA b 1 ROA b Internal Growth rate 0145 065 1 0145 065 Internal Growth rate 00943 1 00943 Internal Growth Rate 00943 09057 Internal Growth rate 01041 or See Answer

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9. Last year, a firm had a ROA of 14.5 percent and a dividendpayout ratio of 35 percent. What is the firm’sinternal growth rate?A. 33.33%B. 25.40%C. 19.05%D. 13.64%E. 10.41%10. In 2014, Umbrellas Unlimited, Inc. had an ROE of 18.5 percentand a dividend payout ratio of 40 percent.What is the sustainable growth rate?A. 19.76%B. 13.17%C. 12.49%D. 10.99%E. 10.12%14. In 2015, Burgundy Shoes, Inc. had net income of $313,125,sales of $1.95 million, and debt of $780,000.Suppose the firm has total assets of $2.45 million and a dividendpayout ratio of 42%. What is the sustainablegrowth rate?A. 19.8%B. 17.5%C. 15.1%D. 13.9%E. 12.2%15. You have located the following information on Clay PotsCompany: debt ratio = 36%, capital intensity ratio =1.60 times, profit margin = 11.5%, and dividend payout ratio = 25%.What is the sustainable growth rate forClay Pots?A. 9.89%B. 9.20%C. 8.15%D. 6.83%E. 7.56%