In the Year Just Ended,Ellie May's Power Tools Had Net

question 41

Multiple Choice

In the year just ended,Ellie May's Power Tools had net income of $200,000 based upon a sales level of $1,500,000.It's total assets are $800,000 while its total equity is $700,000.If Ellie May pays out 0% of its net income in dividends,then what is the firm's sustainable growth rate going forward?

• A) .40%
• B) 38%
• C) 40%
• D) none of the above

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Definitions:

Multiply

The arithmetic operation of scaling one number by another, essentially repeated addition.

Multiply

The arithmetic process of calculating the result of adding a number to itself a certain number of times.

Simplify

To simplify means to reduce an expression or equation to its simplest form, by combining like terms, reducing fractions, etc.

Combine

The process of uniting two or more expressions into a single expression using mathematical operations.