Question

A. The most recent financial statements for Bello Co. are shown here: Income Statement Balance Sheet...

A.

The most recent financial statements for Bello Co. are shown here:

Income Statement Balance Sheet
  Sales $ 20,100 Current assets $ 11,940 Debt $ 16,420
  Costs 13,800 Fixed assets 31,500 Equity 27,020
  Taxable income $ 6,300     Total $ 43,440     Total $ 43,440
  Taxes (21%) 1,323
    Net income $ 4,977

Assets and costs are proportional to sales. Debt and equity are not. The company maintains a constant 45 percent dividend payout ratio.

What is the internal growth rate? (Do not round intermediate calculations and enter your answer as a percent rounded 2 decimal places, e.g., 32.16.)

B.

The most recent financial statements for Bello Co. are shown here:

Income Statement Balance Sheet
  Sales $ 19,200 Current assets $ 11,760 Debt $ 15,880
  Costs 13,050 Fixed assets 27,450 Equity 23,330
  Taxable income $ 6,150     Total $ 39,210     Total $ 39,210
  Taxes (24%) 1,476
    Net income $ 4,674

Assets and costs are proportional to sales. Debt and equity are not. The company maintains a constant 45 percent dividend payout ratio.

What is the sustainable growth rate? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.)

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