Desired total debt ratio is 75. determine firms sustainable, Ask an Expert

Accounting

Q1) Inkheart Inc has profit margin of 11% and retention ratio of 70%. Last year, firm had sales of $500 and total assets of $1,000. Desired total debt ratio is 75%. Determine firm's sustainable growth rate (SGR)?

SGR = (ROE x Retention Ratio) / (1- ROE x Retention Ratio)

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Accounting Basics, Accounting

Category:- Accounting Basics
Reference No.:- M920430

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