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You've collected the following information about Caccamisse, Incorporated: Sales Net income. Dividends Total debt Total equity W a. Sustainable growth rate b. Additional borrowing c. Growth rate $ 250,000 $ 17,100 $ 5,900 $ 54,000 $ 85,000 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. % %

You've collected the following information about Caccamisse, Incorporated: Sales Net income. Dividends Total debt Total equity W a. Sustainable growth rate b. Additional borrowing c. Growth rate $ 250,000 $ 17,100 $ 5,900 $ 54,000 $ 85,000 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. % %

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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k ces You've collected the following information about Caccamisse, Incorporated: $ 250,000 $ 17,100 $ 5,900 $ 54,000 $ 85,000 Sales Net income Dividends Total debt Total equity 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. a. Sustainable growth rate b. Additional borrowing c. Growth rate % %
Transcribed Image Text:k ces You've collected the following information about Caccamisse, Incorporated: $ 250,000 $ 17,100 $ 5,900 $ 54,000 $ 85,000 Sales Net income Dividends Total debt Total equity 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. a. Sustainable growth rate b. Additional borrowing c. Growth rate % %
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