Assume Costs and Assets Increase at the Same Rate as Sales

question 311

Multiple Choice

Assume costs and assets increase at the same rate as sales. Also assume 40% of net income is paid out in dividends, the current debt to equity ratio is optimal, and that no new equity sales are possible. Forecast the addition to retained earnings assuming the firm's sales increase at the maximum percent possible given these assumptions.

• A) $43.2
• B) $88.5
• C) $113.3
• D) $146.7
• E) $167.8

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Definitions:

Baby's Head

A reference often used in childbirth to indicate the part of the baby that is delivered first in a normal vaginal delivery.

Birth Process

The series of events that lead to the delivery of a baby, including labor and passage through the birth canal.

Pelvic Inlet

The upper opening of the pelvis, through which structures can pass between the trunk and the legs.

Tibia

A large bone located in the lower leg, also known as the shinbone, that bears much of the body's weight.