Question
Youve collected the following information about Draiman, Inc.: Sales $ 160,000 Net income $ 12,400 Dividends $ 8,200 Total debt $ 64,000 Total equity $
Youve collected the following information about Draiman, Inc.:
Sales $ 160,000
Net income $ 12,400
Dividends $ 8,200
Total debt $ 64,000
Total equity $ 54,000
What is the sustainable growth rate for the company?
If it does grow at this rate, how much new borrowing will take place in the coming year, assuming a constant debtequity ratio?
What growth rate could be supported with no outside financing at all?
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International Financial Management
Authors: Jeff Madura, Roland Fox
5th Edition
1473770505, 978-1473770508
