1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
Novosadov [1.4K]
2 years ago
6

Stop and Go has a 4 percent profit margin and a 43 percent dividend payout ratio. The total asset turnover is 1.65 and the debt-

equity ratio is .70. What is the sustainable rate of growth
Business
1 answer:
frosja888 [35]2 years ago
8 0

Answer:

6.83%

Explanation:

Given :

Profit margin = 4% = 0.04

Dividend payout ratio = 43% = 0.43

Asset turnover = 1.65

Debt to equity = .7

The retention rate is 1 - the payout ratio = 1 - 0.43 = 0.57

The sustainable growth rate is given by :

(ROE * Retention Rate) / (1 - (ROE * Retention Rate))

Return on Equity (ROE) :

Profit margin * Asset turnover * Equity multiplier

Equity ratio = debt to equity ratio + 1 = 0.7 + 1 = 1.7

= 0.04 * 1.65 * 1.7 = 0.1122

Sustainable growth rate :

(ROE * Retention Rate) / (1 - (ROE * Retention Rate))

(0.1122 * 0.57) / (1 - (0.1122 * 0.57))

0.063954 / 0.936046

= 0.0683235

= 6.83%

You might be interested in
Journalizing issuance of stock—at par and at a premium
suter [353]

Answer:

a.

Cash                                                                           27000 Dr

     Common Stock                                                            13500 Cr

     Paid in capital in excess of par-Common stock         13500 Cr

b.

Cash                                                    135000 Dr

     Preferred Stock                                   135000 Cr

Explanation:

a.

When we issue stock at premium, we always record the amount received from such issuance of stock at full. So, the cash account will be debited for 4500 * 6 = 27000

However, we record the common stock issued at par value and the remaining is credited under the reserve account which is Paid in capital in excess of par.

Thus the common stock will be credited by its par value of 4500 * 3 = 13500 and the remaining 4500 * 3 will be credited to the Paid in Capital account.

b.

The par value of the preferred stock is 4500 * 30 = 135000

Thus the preferred stock is issued at par and we simply debit the cash received from the issue and credit the preferred stock.

4 0
3 years ago
Prior to labor unions, both the employer and employee had the legal right to terminate an employment
Kruka [31]

Before the times of the labor unions, both the employer and the employee reserved the right of employment at will, meaning either one could terminate the agreement at any time and for any reason.

The correct term for the situation proposed in the question is employment at will. The other options describe agreements that have arisen since the creation of the labor unions.

The first option, a closed shop, described an agreement made between the hiring party and the labor unions in which the hiring party agrees to <u>only hire members of the union</u>, while an open shop is just the opposite.

Collective bargaining, on the other hand, is the long process in which the workers of an institution work through their labor unions in order to <u>negotiate contracts </u><u>and the terms of </u><u>employment</u><u>, which include income and benefits. </u>

Therefore the only option that existed prior to the development of labor unions is employment at will, which allowed the termination of a contract at any time for any reason.

To learn more visit:

brainly.com/question/518131?referrer=searchResults

3 0
3 years ago
An _______________ is a network link that uses internet technologies to interconnect the intranet of a business with the intrane
Usimov [2.4K]
I believe the answer would be Intranet, but I am not 100% sure.
7 0
2 years ago
On December 1, 2020, Sheridan Corporation incurs a 15-year $400000 mortgage liability in conjunction with the acquisition of an
Novosadov [1.4K]
Yessss when u get the answer tell meee
6 0
3 years ago
Thomas Kratzer is the purchasing manager for the headquarters of a large insurance company chain with a central inventory operat
Cerrena [4.2K]

Answer:

a. 208.57 units

b. 104.29 units

Explanation:

a. The computation of the economic order quantity is shown below:

= \sqrt{\frac{2\times \text{Annual demand}\times \text{Ordering cost}}{\text{Carrying cost}}}

= \sqrt{\frac{2\times \text{6,000}\times \text{\$29}}{\text{\$8}}}

= 208.57 units

b. And, the average inventory is

= Economic order quantity ÷ 2

= 208.57 units ÷ 2

= 104.29 units

We simply applied the above formulas for calculation of the economic order quantity and the average inventory and the same is shown above

5 0
3 years ago
Other questions:
  • N a just-in-time logistics system, __________. producers supply products to resellers before customers place their orders produc
    9·1 answer
  • What recently happened in the automobile industry that exemplifies the idea that "we need to value more the creation of ideas in
    5·1 answer
  • Selections, a general partnership, operates a gift shop. Selections has five partners. Tony has a one-third interest in the part
    10·1 answer
  • Variable Costing
    8·1 answer
  • The management team of Wickersham Brothers Inc. is preparing its annual financial statements. The statements are complete except
    7·1 answer
  • Cosmo has just made his dream come true of buying the property that his restaurant occupies. His excitement is short lived, howe
    6·1 answer
  • Batteries, Offshore Wind Lead Clean Energy Cost Cuts As Renewables by Mike Scott Batteries, Offshore Wind Lead Clean Energy Cost
    11·1 answer
  • According to the acquired needs theory, the desire to influence others is part of the need for:.
    9·1 answer
  • ______ are responsible for supervising frontline employees and carry out day-to-day activities within departments.
    9·1 answer
  • You are the manager of a retail store. Shipments of the products you sell arrive once a week from the central warehouse and you
    9·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!