Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Gilmore, Inc., had equity of $195,000 at the beginning of the year. At the end of the year, the company had total assets of $350,000.

image text in transcribedimage text in transcribed

Gilmore, Inc., had equity of $195,000 at the beginning of the year. At the end of the year, the company had total assets of $350,000. During the year, the company sold no new equity. Net income for the year was $41,000 and dividends were $5,800. a. Calculate the internal 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. Calculate the internal growth rate using ROA ~ b for beginning of period total assets. (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) Calculate the internal growth rate using ROA b for end of period total assets. (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) Internal growth rate ROA b (using beginning of period assets) ROA b (using end of period assets) 18.05% 18.05% 15.26% Gilmore, Inc., had equity of $195,000 at the beginning of the year. At the end of the year, the company had total assets of $350,000. During the year, the company sold no new equity. Net income for the year was $41,000 and dividends were $5,800. a. Calculate the internal 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. Calculate the internal growth rate using ROA ~ b for beginning of period total assets. (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) Calculate the internal growth rate using ROA

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Finance And Financial Markets

Authors: Keith Pilbeam

3rd Edition

023023321X, 978-0230233218

More Books

Students also viewed these Finance questions

Question

Fully associative caches have no conflict misses. True False

Answered: 1 week ago