Youve collected the following information about Erna, Inc.: Sales = $ 275,000 Net income = $ 19,000
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Question:
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Youve collected the following information about Erna, Inc.: |
Sales | = | $ | 275,000 | |
Net income | = | $ | 19,000 | |
Dividends | = | $ | 8,100 | |
Total debt | = | $ | 67,000 | |
Total equity | = | $ | 91,000 |
Requirement 1: |
What is the sustainable growth rate for the company?(Do not round intermediate calculations.Enter your answer as a percent rounded to 2 decimal places (e.g., 32.16).) |
Sustainable growth rate | % |
Requirement 2: |
Ifit does grow at this rate, how much new borrowing will take place in the coming year, assuming a constant debt-equity ratio?(Do not round intermediate calculations.Round your answer to 2 decimal places (e.g., 32.16).) |
Additional borrowing | $ |
Requirement 3: |
What growth rate could be supported with no outside financing at all?(Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places (e.g., 32.16).) |
Internal growth rate | % |
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