You’ve collected the following information about Odyssey, Inc.: Sales =$165,000 Net income = $14,800 Dividends = $9,300 Total debt = $68,000 Total equity = $51,000 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 debt –equity ratio? What growth rate could be supported with no outside financing at all?

You’ve collected the following information about Odyssey, Inc.: Sales =$165,000 Net income = $14,800 Dividends = $9,300 Total debt = $68,000 Total equity = $51,000 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 debt –equity ratio? What growth rate could be supported with no outside financing at all?

Intermediate Financial Management (MindTap Course List)

13th Edition

ISBN:9781337395083

Author:Eugene F. Brigham, Phillip R. Daves

Publisher:Eugene F. Brigham, Phillip R. Daves

Chapter17: Dynamic Capital Structures And Corporate Valuation

Section: Chapter Questions

Problem 3P

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