Given Sales : $250,000 NI : $40,000 Dividends: $10,000 Tot Debt: $100,000 Total Equity: $100,000 What growth rate can be supported without outside financing? A. 9.75% B. 18% C.11.75% D. 22% 28.13%

Q: A bank with $10,000 in assets has ROA =2% and ROE - 10%. What is its leverage ratio (TA/Equity)?…

A: ROA and ROE for a bank are known. Equity multiplier or the leverage ratio (TA/Equity) needs to be…

Q: Question 7 Given are the following data: Cost of debt ro 6%; Cost of equity re 12.1%; Marginal tax…

A: The weighted average cost of capital can be calculated by multiplying the cost of capital by their…

Q: Banco Industries expect sales to grow at a rapid rate over the next three years, but settle to an…

A: The present value of the free cash flows will give us the enterprise value.   We can find the stock…

Q: Suppose First National Bank has $500 million of assets and $ $75 million of equity capital. If First…

A: Assets =$ 500 Million, Equity = $ 75 Million  ROA = 5%   Hence, ROA = Return  Assets 5%= Return $500…

Q: Profit margin Capital intensity ratio Debt-equity ratio Net income Dividends = Sustainable growth…

A: Proft margin9.50%Capital Intensity ratio0.56Debt-Equity Ratio0.71Net…

Q: How much equity would have to be swapped out for debt to increase ROE by 1% assuming that nothing…

A: ROE is the ratio which studies the relation of profit earned and firm’s equity. ROE shows how much…

Q: Q. 5 You’ve collected the following information about Gandalf, Inc.: Sales = $255,000 Net Income…

A: 1) Rentetion ratio(b)=1-DividendNet income                      =1-600017200=65.12%Return On equity…

Q: If the company’s Interest on Debt is OMR 50,000 with 10% interest rate, the market value of Equity…

A: According to this approach, the valuation of a firm is not dependent on its capital structure (i.e.…

Q: Net income Shareholders' Equity Dividends Sales Revenue 5,000,000 30,000,000 3,000,000 100,000,000…

A: Sustainable growth rate is the growth rate which can be obtained without external funding required.

Q: need help

A: Step 1: (1).  ROE Calculation for the Firm: Given: Times Interest Earned (TIE) Ratio = 2 Tax…

Q: Looking at the template pro forma below , make this one change The firm is not going to pay an…

A: There would be no effect on the free cash flows of the Company since net interest after taxes is…

Q: A bank has 100 in assets and 60 in liabilities. Suppose assets pay on average 6% and liabilities…

A: Expected rate of return on capital It is calculated as shown below. Expected rate of…

Q: a. What is the sustainable growth rate for the company? (Do not round interme calculations and enter…

A: The sustainable growth rate (SGR) for a companySGR = ROE × (1−Dividend Payout Ratio)ROE =…

Q: Profit margin Capital intensity ratio Debt-equity ratio Net income Dividends II II = 8.6% 0.47 0.62…

A: Sustainable growth rate refers to that maximum possible growth rate at which a company can grow…

Q: What will be the cost of capital, after tax, for a company with 60% debt and 40% equity split if…

A: The cost of capital is calculated by taking the weighted average of the after-tax costs of a…

Q: A firm has $60 million in equity and $40 million of debt, it pays dividends of 20% of net income,…

A: Equity=$60 million Debt=$40 million Net Income=$20 million Dividend=20% Required: Sustainable Growth…

Q: The Green Giant has a 5 percent profit margin and a 34 percent dividend payout ratio. The total…

A: The rate at which a business may continue growing without needing more funding from outside sources…

Q: Determine the firm's cost of capital. b. If the debt ratio rises to 50 percent and the cost of…

A: Cost of capital is the return that all the security holder of a company expects to get.  In this…

Q: 1) What is the internal growth rate? 2) What is the sustainable growth rate? % (Give as a percentage…

A: To solve this question, we first need to compute Net Profit, Return on Assets and Return on Equity…

Q: FCFE Valuation A company's most recent free cash flow to equity was $130 and is expected to grow at…

A: concept and formula. value of firm = FCFE(1+g)ke-g where , FCFE  =  free cash flow to equity  g=…

Q: a. What is the firm's value if cash flows are expected to grow at an annual rate of 0% from now to…

A: The amount of cash available to a corporation after covering the costs of doing business is measured…

Q: A=10% E=11.2% rrent ratio =1.5 ick ratio=0.9 ss profit margin=24% es=1650000 ning available for…

A: Debt ratio is the ratio calculate on total assets. It repersent the portion of assets financed from…

Q: nterest rate Tax rate Dividend Common stock on the market Growth rate Debt ratio 9% 30% $2.50 $50 8%…

A: Cost of capital The rate of interest paid by a company to investors for the use of their funds in…

Q: Plz Use excel !!!  and show formula A company currently has a WACC of 10.6 percent and no debt. The…

A: Since you have posted a question with multiple sub-parts, we will solve the first three sub-parts…

Q: A firm has a current price of Rs. 160 a share, an expected growth rate of 11 percent and expected…

A: The given problem can be solved using constant dividend growth model

Q: 12.  A firm has a total market value of £30,000. It borrows £7500 at 8% interest rate. If the return…

A: Cost of Equity can be calculated as = (Earning for Equity Shareholder / Market Value of Equity) x…

Q: Current ratio=2.5 times Profit margin=10% sales= $1,180 million ROE= 20% Long term debt to Long-term…

A: As per the given information:To determine:Current assets, fixed assets, total assets, long-term…

Q: What is the price per share based on the equity free cash flow model?

A: The stock price per share is the amount of money that you would have to pay to buy one share of a…

Q: Given the following data Free cash flow= $3.0 million Expected constant growth = 6% Beta = 1.5 Tax…

A: Free Cash Flow 3,000,000 Growth Rate 6% Beta 1.5 Tax Rate 40% Debt in Capital Structure 40%…

Q: 1. Company Yoyo currently pays out a dividend of £2 per share. It reinvests 1/3 of earnings in…

A: Growth rate g = Retention ratio * Return on Investment ( ROI ) Thus, g = 13×15% g = 5%   Current…

Q: Purcell Farms Inc. has the following data, and it follows the residual dividend model. Currently, it…

A: Residual dividend policy states that internal accruals (net income) will be first used to finance…

Q: The following information is available regarding XYZ Co. sales = $250,000 net income = $35,000…

A: Here, Sales is $250,000Net Income is $35,000Dividends is $10,000Total Debt is $100,000Total Equity…

Q: A firm has sales of $1.2 million, a profit margin of 5%, and a dividend payout ratio of 30%. How…

A: Retained Earning= Profit * Retention Ratio  Retention Ratio= 1-Dividend Payout Ratio Profit= Sales *…

Q: f the company’s EBIT is OMR 500,000; market value of the equity is OMR 2,000,000 and value of Debt…

A: Market value of equit + Debt  = EBIT / Cost of capital

Q: Use the table for the question(s) below. FCF Forecast ($ million) Year Sales 0 240 1 270 Growth…

A: We need to use free cash flow approach for valuation of share price.WhereFCF1,FCF2... are free cash…

Q: Sales Revenue 10,000 9,000 Costs Net Income 2,000 Dividends 500 NEXT YEAR QUESTIONS Sales revenue…

A: Dividend: A dividend alludes to an award, cash or otherwise, that an organization provides to its…

Q: You have been asked to value a firm with expected annual after-tax cash flows, before debt payments,…

A: Capital structure of the firm consists of both debt and equity. Cost of raising funds from each…

Q: A firm has an equity multiplier of two and total assets of $300. If its return on equity is 10%,…

A: Equity Multiplier = 2 Total Assets = 300 Return on Equity = 10% Net Income = ?

Q: A firms ROE is 30%, dividends are 3,000,000, net income is 25% of sales and sales is 27,000,000.…

A: Return on Equity= ROE = 30%Dividend = d = 3,000,000Net Income of Sales = 25%Sales = s = 27,000,000

Q: Levered Beta Market Value of Equity Market Value of Debt Cash Marginal Tax Rate Firm A 1.50 $2.4…

A: We have to find the unlevered beta adjusted for excess cash. Then we have to combine the beta…

Q: Equity  = 6,300,000 Debt =  3,920,000 Preferred stock   = 6,000,000 Cost of eqiuty   = 10.91% cost…

A: The WACC of the company is the average return that the company provides to its stakeholders for…

Q: Use the table for the question(s) below. FCF Forecast ($ million) Year Sales Growth versus Prior…

A: We need to use free cash flow approach for valuation of share price.WhereFCF1,FCF2... are free cash…

Q: Sustainable Growth rate

A: No company can survive without growth. Sustainable growth rate means the growth that the company can…

Q: Free Cash Inc. is expected to have free cash flow to equity next year (FCFE1) equal to $9 million as…

A: Value of debt = Value of firm - Value of equity Value of equity = FCFE1/(cost of equity - growth…