The most recent financial statements for Bello Co. are shown here:   Income Statement   Balance Sheet     Sales $ 20,500   Current assets $ 12,020   Debt $ 16,660     Costs   14,100   Fixed assets   33,300   Equity   28,660                             Taxable income $ 6,400       Total $ 45,320       Total $ 45,320                             Taxes (21%)   1,344                                               Net income $ 5,056                                               Assets and costs are proportional to sales. Debt and equity are not. The company maintains a constant 30 percent dividend payout ratio.    What is the internal growth rate? (Do not round intermediate calculations and enter your answer as a percent rounded 2 decimal places, e.g., 32.16.)

Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
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The most recent financial statements for Bello Co. are shown here:

 

Income Statement   Balance Sheet  
  Sales $ 20,500   Current assets $ 12,020   Debt $ 16,660  
  Costs   14,100   Fixed assets   33,300   Equity   28,660  
                       
  Taxable income $ 6,400       Total $ 45,320       Total $ 45,320  
                       
  Taxes (21%)   1,344                  
                       
    Net income $ 5,056                  
                       
 

 

Assets and costs are proportional to sales. Debt and equity are not. The company maintains a constant 30 percent dividend payout ratio. 

 

What is the internal growth rate? (Do not round intermediate calculations and enter your answer as a percent rounded 2 decimal places, e.g., 32.16.)

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