The financial statements of Eagle Sport Supply are shown in the table below. For simplicity, "Costs" include interest. Assume thatEagle's assets are proportional to its sales. Assume a growth rate of 30% in revenue, expenses, and assets in 2023. The tax rate willremain constant.SalesIncome StatementCosts$ 2,7501,150Pretax incomeTaxes (at 30.0%)$ 1,600480Net income$ 1,1202021Balance Sheet, Year-End2022Net assets$ 4,800 $ 4,500DebtTotal$ 4,800 $ 4,500EquityTotal2022$ 1,9002,9002021$1,8002,700$ 4,800 $4,500a. Assume that the dividend payout ratio is fixed at 50% and the equity-to-asset ratio is fixed at two-thirds. What is the internalgrowth rate for 2023?b. What is the sustainable growth rate for 2023?Note: For all requirements, do not round intermediate calculations. Enter your answers as a percent rounded to 2 decimal places.a. Internal growth rateb. Sustainable growth rate%%

Internal growth rate refers to the growth increase up to maximum level from the available resources…

The financial statements of Eagle Sport Supply are shown in the table below. For simplicity, "Costs" include interest. Assume that Eagle's assets are proportional to its sales. Assume a growth rate of 30% in revenue, expenses, and assets in 2023. The tax rate will remain constant. Income Statement $2,750 1,150 $1,600 480 Sales Costs Pretax income Taxes (at 30.0%) Net income $ 1,120 Balance Sheet, Year-End Net assets 2022 2021 $ 4,800 $4,500 2022 Total $ 4,800 $4,500 Debt Equity Total 2021 $1,900 $ 1,800 2,900 2,700 $ 4,800 $4,500 a. Assume that the dividend payout ratio is fixed at 50% and the equity-to-asset ratio is fixed at two-thirds. What is the internal growth rate for 2023? b. What is the sustainable growth rate for 2023?

The financial statements of Eagle Sport Supply are shown in the table below. For simplicity, "Costs" include interest. Assume that Eagle's assets are proportional to its sales. Assume a growth rate of 30% in revenue, expenses, and assets in 2023. The tax rate will remain constant. Income Statement $2,750 1,150 $1,600 480 Sales Costs Pretax income Taxes (at 30.0%) Net income $ 1,120 Balance Sheet, Year-End Net assets 2022 2021 $ 4,800 $4,500 2022 Total $ 4,800 $4,500 Debt Equity Total 2021 $1,900 $ 1,800 2,900 2,700 $ 4,800 $4,500 a. Assume that the dividend payout ratio is fixed at 50% and the equity-to-asset ratio is fixed at two-thirds. What is the internal growth rate for 2023? b. What is the sustainable growth rate for 2023?

Intermediate Financial Management (MindTap Course List)

13th Edition

ISBN:9781337395083

Author:Eugene F. Brigham, Phillip R. Daves

Publisher:Eugene F. Brigham, Phillip R. Daves

Chapter6: Accounting For Financial Management

Section: Chapter Questions

Problem 11P: The Berndt Corporation expects to have sales of 12 million. Costs other than depreciation are...

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The financial statements of Eagle Sport Supply are shown in the table below. For simplicity, "Costs" include interest. Assume that Eagle's assets are proportional to its sales. Assume a growth rate of 30% in revenue, expenses, and assets in 2023. The tax rate will remain constant. Income Statement Sales Costs $ 4,550 2,050 Pretax income Taxes (at 30.0%) $ 2,500 750 Net income $ 1,750 Balance Sheet, Year-End 2022 Net assets $ 6,600 2021 $ 6,300 Total $ 6,600 $ 6,300 Debt Equity Total 2022 $ 2,800 3,800 2021 $ 2,700 3,600 $ 6,600 $ 6,300 a. Assume that the dividend payout ratio is fixed at 60% and the equity-to-asset ratio is fixed at two-thirds. What is the internal growth rate for 2023? b. What is the sustainable growth rate for 2023? Note: For all requirements, do not round intermediate calculations. Enter your answers as a percent rounded to 2 decimal places. a. Internal growth rate b. Sustainable growth rate % %
The financial statements of Eagle Sport Supply are shown in the table below. For simplicity, "Costs" include interest. Assume that Eagle's assets are proportional to its sales. Assume a growth rate of 30% in revenue, expenses, and assets in 2020. The tax rate will remain constant. Income Statement Sales Costs Pretax income Taxes (at 40.0%) Net income 2019 Net assets $5,400 Total $3,350 1,450 $1,900 760 $1,140 Balance Sheet, Year-End 2018 $5,100 $5,400 $5,100 2019 $2,200 3,200 Debt Equity Total $5,400 6.42 x % a. Assume that the dividend payout ratio is fixed at 50% and the equity-to-asset ratio is fixed. What is the internal growth rate for 2020? (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places.) X Answer is complete but not entirely correct. Internal growth rate 2018 $2,100 3,000 $ 5,100 b. What is the sustainable growth rate for 2020? (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal…
The financial statements of Eagle Sport Supply are shown in the table below. For simplicity, "Costs" include interest. Assume that Eagle's assets are proportional to its sales. Assume a growth rate of 30% in revenue, expenses, and assets in 2020. The tax rate will remain constant. Income Statement Sales Costs Pretax income Taxes (at 40.0%) Net income Net assets Total 2019 $5,400 $5,400 Internal growth rate $3,350 1,450 $1,900 760 $1,140 Balance Sheet, 2018 $5,100 Sustainable growth rate $ 5,100 Year-End % Debt Equity Total a. Assume that the dividend payout ratio is fixed at 50% and the equity-to-asset ratio is fixed. What is the internal growth rate for 2020? (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places.) 2019 $ 2,200 3,200 $5,400 2018 $ 2,100 3,000 $ 5,100 b. What is the sustainable growth rate for 2020? (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places.) %
Mee Kolok Berhad had developed the following income statement for its operations ended 30 June 2022. Sales (-) Variable Cost (-) Fixed Costs Earnings Before Interest and Taxes Interest Expense Earnings Before Tax Taxes @ 28% Net Income RM 384,000 230,400 96,000 57,600 19,200 38,400 10,752 27,648 Q1) Current Earning per Share (EPS) is RM3.60. Calculate the new EPS for Mee Kolok Berhad Berhad next year if sales increase by 15%.
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