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Deprey, Incorporated, had equity of $125,000 at the beginning of the year. At the end of the year, the company had total assets of
Deprey, Incorporated, had equity of $125,000 at the beginning of the year. At the end of the year, the company had total assets of $280,000. During the year, the company sold no new equity. Net income for the year was $27,000 and dividends were $3,000. a. What is the sustainable growth rate for the company? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) b. What is the sustainable growth rate if you use the formula ROE x b and beginning of period equity? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) c. What is the sustainable growth rate if you use end of period equity in this formula? (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. ROE x b (using beginning of period equity) c. ROE x b (using end of period equity) % % %
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