Sustainable Growth Rate You Are Considering Investing in Annie's Eatery

question 40

Essay

Sustainable Growth Rate You are considering investing in Annie's Eatery.You have been able to locate the following information on the firm: total assets are $50 million,accounts receivable are $6.0 million,ACP is 20 days,net income is $5.5 million,debt-to-equity is 2.5 times,and dividend payout ratio is 55 percent.All sales are on credit.Annie's is considering loosening its credit policy such that ACP will increase to 25 days.The change is expected to increase credit sales by 5 percent.Any change in accounts receivable will be offset with a change in debt.No other balance sheet changes are expected.Annie's profit margin and dividend payout ratio will remain unchanged.Use the DuPont equation to determine how this change in accounts receivable policy will affect Annie's sustainable growth rate.

Assess the effect of social class on various aspects of a person's life, including status inconsistency and social mobility.

Explore contemporary issues affecting social inequality, such as the digital divide, residential segregation, and homelessness.

Understand the concept of deviance and its societal implications.

Identify different societal responses to deviance across communities and historical periods.

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Definitions:

Rice

A cereal grain which is a staple food for a large part of the world's human population, especially in Asia.

World Price

The international market price of a good or service, influenced by global supply and demand conditions.

Domestic Supply

The total amount of goods and services provided by a country's own economy without importing from other countries.

Imported

Describes goods or services brought into one country from another for sale, usually regulated by import quotas and tariffs.