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Sustainable Growth

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Based on the following information what is the sustainable growth rate?

Profit Margin = 10.2% Captial Intensity Ratio = .70
Debt-equity Ratio = .50 Net Income = $30,000
Dividends = $6,000

What is the ROE here?

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Solution Summary

The solution explains how to calculate the Sustainable Growth Rate

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Profit Margin = Net Income/sales = 10.2% and net income = 30,000
Sales = 30,000/10.2%=294,117.60

Capital Intensity = Assets/Sales = 0.7 and sales = ...

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