A Decrease in Which One of the Following Will Increase

question 67

Multiple Choice

A decrease in which one of the following will increase a firm's sustainable rate of growth?

• A)net income
• B)dividend payout ratio
• C)total assets
• D)retention ratio
• E)earnings per share

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Definitions:

Unamortized Discount

An unamortized discount refers to the portion of a bond's initial discount that has not yet been amortized or gradually written off over the life of the bond.

Redeemed

Usually refers to the repurchase or paying off of a debt or equity security at its original value or at a predetermined value before it matures.

Effective Interest Rate Method

The effective interest rate method is a technique for calculating the actual interest rate for a financial product over its life, considering compounding.

Bonds Payable

A long-term liability account that records the face value of the bonds a company is obligated to repay at a specified future date.