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You've collected the following information about Gandalf, Inc.: 315,000 Sales = $ Net income Dividends Total debt = $ 18,400 $ 7,200 $67,000 98,000 =
You've collected the following information about Gandalf, Inc.: 315,000 Sales = $ Net income Dividends Total debt = $ 18,400 $ 7,200 $67,000 98,000 = $ = Total equity a. What is the sustainable 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. Assuming it grows 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 and round your answer to 2 decimal places, e.g., 32.16.) c. What growth rate could be supported with no outside financing at all? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) a. 12.90 % Sustainable growth rate Additional borrowing b. c. Growth rate %
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