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Your firm has an ROE of 12.2%, a payout ratio of 28%,$556,700 of stockholders' equity, and $419,000 of debt. If you grow at your sustainable
Your firm has an ROE of 12.2%, a payout ratio of 28%,$556,700 of stockholders' equity, and $419,000 of debt. If you grow at your sustainable growth rate this year, how much additional debt will you need to issue? The Tax Cuts and Jobs Act of 2017 temporarily allows 100% bonus depreciation (effectively expensing capital expenditures). However, we will still include depreciation forecasting in this chapter and in these problems in anticipation of the return of standard depreciation practices during your career. The sustainable growth rate is 1o. (Round to three decimal place.)
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