You wish to compute a firm's sustainable growth rate from its accounting statements. To do so, you could use the values of: Question 3 options: A) Total assets, net income, and the retention ratio. B) Net income, equity, and total assets. C) Net income, equity, and the dividend payout ratio. D) Interest paid, equity, and total assets. E) Total assets, interest paid, and equity.
Financial Ratios
A Ratio refers to a figure calculated as a reference to the relationship of two or more numbers and can be expressed as a fraction, proportion, percentage, or the number of times. When the number is determined by taking two accounting numbers derived from the financial statements, it is termed as the accounting ratio.
Return on Equity
The Return on Equity (RoE) is a measure of the profitability of a business concerning the funds by its stockholders/shareholders. ROE is a metric used generally to determine how well the company utilizes its funds provided by the equity shareholders.
You wish to compute a firm's sustainable growth rate from its accounting statements. To do so, you could use the values of: Question 3 options: A) Total assets, net income, and the retention ratio. B) Net income, equity, and total assets. C) Net income, equity, and the dividend payout ratio. D) Interest paid, equity, and total assets. E) Total assets, interest paid, and equity.
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