Answered

Westonci.ca is your go-to source for answers, with a community ready to provide accurate and timely information. Connect with a community of experts ready to help you find solutions to your questions quickly and accurately. Explore comprehensive solutions to your questions from a wide range of professionals on our user-friendly platform.

Eagle Sports Supply has the following financial statements. Assume that Eagle’s assets are proportional to its sales.
INCOME STATEMENT, 2019
Sales $ 950
Costs 250
Interest 50
Taxes 150
Net income $ 500
BALANCE SHEET, YEAR-END
2018 2019 2018 2019
Assets $ 2,700 $ 3,000 Debt $ 900 $ 1,000
Equity 1,800 2,000
Total $ 2,700 $ 3,000 Total $ 2,700 $ 3,000

a. What is the internal growth rate of Eagle Sports if the dividend payout ratio is fixed at 70% and the equity-to-asset ratio is fixed at 2/3?
Note: Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places.
b. What is the sustainable growth rate?
Note: Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places.

Sagot :

Thank you for visiting our platform. We hope you found the answers you were looking for. Come back anytime you need more information. We hope our answers were useful. Return anytime for more information and answers to any other questions you have. We're glad you visited Westonci.ca. Return anytime for updated answers from our knowledgeable team.