Loreto Inc. has the following financial ratios: asset turnover = 2.20; net profit margin (i.e., net income/sales) = 6%; payout ratio = 40%; equity/assets = 0.50. a. What is Loreto's sustainable growth rate? b. What is its internal growth rate? (Do not round intermediate calculations. Enter your answers as a percent rounded to 2 decimal places.) 5.84 % a. Sustainable growth rate Internal growth rate b. %
Loreto Inc. has the following financial ratios: asset turnover = 2.20; net profit margin (i.e., net income/sales) = 6%; payout ratio = 40%; equity/assets = 0.50. a. What is Loreto's sustainable growth rate? b. What is its internal growth rate? (Do not round intermediate calculations. Enter your answers as a percent rounded to 2 decimal places.) 5.84 % a. Sustainable growth rate Internal growth rate b. %
Chapter12: Corporate Valuation And Financial Planning
Section: Chapter Questions
Problem 2STP
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