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The most recent financial statements for Live Co. are shown here: Income Statement Balance Sheet Sales $11,000 Current assets $23,719 Debt $23,377 Costs 6,600 Fixed

The most recent financial statements for Live Co. are shown here:

Income Statement Balance Sheet
Sales $11,000 Current assets $23,719 Debt $23,377
Costs

6,600

Fixed assets 16,598 Equity 16,940
Taxable income $4,400 Total

$40,317

Total

$40,317

Taxes (34%) 1,496
Net income

$2,904

Assets and costs are proportional to sales. Debt and equity are not. The company maintains a constant 26 percent dividend payout ratio. No external equity financing is possible.

Required:

What is the sustainable growth rate? (Do not round your intermediate calculations.)

rev: 09_17_2012

Multiple Choice

  • 14.53 %

  • 5.63 %

  • 15.03 %

  • 4.67 %

  • 14.03 %

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