If a Non-Dividend-Paying Firm Bases Its Growth Assumptions on the Sustainable

question 68

Multiple Choice

If a non-dividend-paying firm bases its growth assumptions on the sustainable rate of growth and shows positive net income,then the pro forma statement must reflect

• A)an increase in fixed assets irrespective of the firm's current operating capacity.
• B)an increase in both sales and the debt-equity ratio.
• C)both an increase in the total asset turnover and in the equity multiplier.
• D)a constant debt-equity ratio and an increase in retained earnings.
• E)increases in fixed assets,the debt-equity ratio,and the number of shares outstanding.

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A condition characterized by significant limitations both in intellectual functioning and in adaptive behavior, which covers many everyday social and practical skills.

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