Given the Data Collected for Marion Corporation, Calculate the Following

question 13

Essay

Given the data collected for Marion Corporation, calculate the following: (a) sustainable growth rate.(b) If the company does grow at this rate, determine the new borrowing that needs to occur.(c) What growth rate could be supported with no outside financing?
$$\begin{array} { | l | r | } \hline \text { Data: } & \\\hline \text { Sales } & 400,000 \\\hline \text { Net Income } & 60,000 \\\hline \text { Dividends } & 40,000 \\\hline \text { Total Debt } & 200,000 \\\hline \text { Total Equity } & 50,000 \\\hline\end{array}$$

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Definitions:

Acetone

A volatile, colorless liquid with the formula (CH3)2CO, used as a solvent and in the production of various chemicals.

Electrophile

A chemical species that accepts an electron pair in order to bond to a nucleophile during a chemical reaction.

Lewis Acid

A compound or ionic species that can accept an electron pair from a donor molecule, often functioning as a catalyst in chemical reactions.

Nucleophile

A chemical species that donates an electron pair to form a chemical bond in relation to a reaction.