Answer:
1. A firm's sustainable growth rate represents the:
highest growth rate without increasing financial leverage.
2. The sustainable growth rate of a firm with net income of $2.90 million, cash dividends of $1.90 million, and return on equity of 16% is:
= c. 5.52%
Explanation:
a) Data and Calculations:
Sustainable growth rate = Return on equity * Retention rate
Net income = $2.90 million
Cash dividends 1.90 million
Retained earnings = $1.0 million
Retention rate = $1.0/$2.90 * 100 = 34.48%
Return on equity = 16%
Therefore, the sustainable growth rate = 16% * 34.48%
= 5.5168%
= 5.52%
b) Sustainable growth rate is the rate of revenue growth, which an entity can attain without increasing its financial leverage (debts). The sustainable growth rate answers the question of how much a company can grow without additional equity or debt financing. It is a ratio that investment analysts and investors widely seek. There are four main ways of increasing an entity's sustainable growth rate, including sale of debt, issue of equity, increased profitability through efficient sales revenue, and reduced dividends payout to increase retained earnings.
What language is this in ⊅ω↑⊂∡⊂⊃∩∅⊃ÉçœÄÈΠЫднеО
Answer:
The answer is:
More accounts have been written off than had been estimated
Explanation:
Doubtful debt or bad debt is an expense. According to the rule of accounting, debit increases an expense while debit decreases an expense.
So the debit balance balance in allowance for doubtful accounts tells us that there is an increase in expense which means that more accounts(bad debt) have been written off.
So we can infer from the debit balance that more accounts have been written off than had been estimated
Base on the given scenario of which the orange company
introduced an innovative mp3 player, the apple inc’s ipod will likely tend to
decrease its mark up as a new rival has been introduced which is having a head
on with the apple’s mp3 product.
The answer is true. A stock is a broad phrase that refers to any company's ownership certificates. A share, on the other hand, refers to a company's stock certificate.
You become a shareholder if you own a share of a specific corporation. Stocks are classified into two types: common and preferred. When you purchase stock in a corporation, you become a part-ownership of that company. If a corporation has 100,000 shares and you purchase 1,000 of them, you own 1% of the company. Investing in stocks is fundamentally about accumulating and growing wealth. The most basic suggestion for traders on how to invest money in the stock market is 'buy cheap, sell high.'
To learn more about stock, click here.
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