None You are thinking of investing in Tikki'sTorches, Inc. You have only the followinginformation on the firm at year-end 2008:Net income $520,000Total debt $12.2 millionDebt ratio 42%What is Tikki's ROE for 2008?a. 1.79%b. 10.14%c. 3.09%d. 4.26%

What is required for this problem is the ROE. ROE or return on equity is the measure of a company's…

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Entrepreneurial Finance

6th Edition

ISBN:9781337635653

Author:Leach

Publisher:Leach

Chapter14: Security Structures And Determining Enterprise Values

Section: Chapter Questions

Problem 10EP

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You've collected the following information about Caccamisse, Incorporated: Sales Net income Dividends Total debt Total equity = = a. Sustainable growth rate b. Additional borrowing c. Growth rate $ 280,000 $ 17,700 $ 6,500 $ 60,000 $ 91,000 a. What is the sustainable growth rate for the company? Note: Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16. b. Assuming it grows at this rate, how much new borrowing will take place in the coming year, assuming a constant debt-equity ratio? Note: Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16. c. What growth rate could be supported with no outside financing at all? Note: Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16. Answer is complete but not entirely correct. 24.14% $ 11,574.00 X 4.00 %
You've collected the following information about Caccamisse, Incorporated: Sales Net income Dividends Total debt Total equity = a. Sustainable growth rate b. Additional borrowing c. Growth rate = = = = $ 330,000 $ 18,700 $ 7,500 $ 70,000 $ 101,000 a. What is the sustainable growth rate for the company? Note: Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16. b. Assuming it grows at this rate, how much new borrowing will take place in the coming year, assuming a constant debt-equity ratio? Note: Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16. c. What growth rate could be supported with no outside financing at all? Note: Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16. % %
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QUESTION: CATHERINE'S CONSULTING HAS NET INCOME OF $4,400 AND TOTAL EQUITY OF $39,450. THE DEBT-EQUITY RATIO IS 1 AND THE PLOWBACK RATIO IS 40 PERCENT. WHAT IS THE RETURN ON ASSETS? QUESTION: AL'S MARKETS EARNS $0.12 IN PROFIT FOR EVERY $1 OF EQUITY AND BORROWS $0.65 FOR EVERY $1 OF EQUITY. WHAT IS THE FIRM'S RETURN ON ASSETS? A) 12.00 PERCENT B) 7.27 PERCENT C) 8.33 PERCENT D) 15.15 PERCENT E) 13.75 PERCENT
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As an analyst, you were task to compute for the WACC of various companies given the following information. Income tax rate is 30%. Risk free rate Beta Market return Debt to equity ratio Dettmargin Accenture Co. 4% 1.25 12% 2.50 2% Nestle Co. 3% 1.5 11% 3.00 3% Which compeny nes the nighest cost of equity? FedEx Co. 2% 1.3 10% 4.00 2.50% Cadence Co. 3.50% 1.4 8% 3.50 1.50%

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You are thinking of investing in Tikki's Torches, Inc. You have only the following information on the firm at year-end 2008: Net income $520,000 Total debt $12.2 million Debt ratio 42% What is Tikki's ROE for 2008? a. 1.79% b. 10.14% c. 3.09% d. 4.26%