Gilmore, Inc., had equity of $220,000 at the beginning of the year. At the end of the year the company had total assets of $375,000. During the year, the company sold no new equity. Net income for the year was $46,000 and dividends were $6,800. a. Calculate the internal growth rate for the company. (Do not round intermediate b. Calculate the internal growth rate using ROA x b for beginning of period total assets. c. Calculate the internal growth rate using ROA x b for end of period total assets. (Do calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.)
Gilmore, Inc., had equity of $220,000 at the beginning of the year. At the end of the year the company had total assets of $375,000. During the year, the company sold no new equity. Net income for the year was $46,000 and dividends were $6,800. a. Calculate the internal growth rate for the company. (Do not round intermediate b. Calculate the internal growth rate using ROA x b for beginning of period total assets. c. Calculate the internal growth rate using ROA x b for end of period total assets. (Do calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.)
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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Transcribed Image Text:Gilmore, Inc., had equity of $220,000 at the beginning of the year. At the end of the year
the company had total assets of $375,000. During the year, the company sold no new
equity. Net income for the year was $46,000 and dividends were $6,800.
a. Calculate the internal growth rate for the company. (Do not round intermediate
b. Calculate the internal growth rate using ROA x b for beginning of period total assets.
c. Calculate the internal growth rate using ROA x b for end of period total assets. (Do
calculations and enter your answer as a percent rounded to 2 decimal places, e.g.,
32.16.)
(Do not round intermediate calculations and enter your answer as a percent
rounded to 2 decimal places, e.g., 32.16.)
not round intermediate calculations and enter your answer as a percent rounded
to 2 decimal places, e.g., 32.16.)
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