The Sustainable Growth Rate Is Equal To

question 65

Multiple Choice

The sustainable growth rate is equal to:

• A)the retention ratio multiplied by ROE.
• B)the dividend payout ratio multiplied by ROA.
• C)the dividend payout ratio multiplied by ROE.
• D)the retention ratio multiplied by ROA.

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Definitions:

Machine-Hours

A measure of the time machines are run, used in allocating manufacturing overhead to products.

Manufacturing Overhead

All manufacturing costs that are not directly associated with the production of a product or service.

Plantwide Predetermined Manufacturing Overhead Rate

A single overhead rate calculated for an entire manufacturing plant, applied to all jobs or products to allocate manufacturing overhead costs.

Machine-Hours

Machine-Hours indicate the total hours that machinery is operating during a specific period of time.