VWX Inc., has sales of $500,000, net income of $80,000, dividend payout of 50%, total assets of $700,000 and target debt-equity ratio of 1.5. If the company grows at its sustainable growth rate in the coming year, how much new borrowing (to the nearest dollar) will take place?

Financial Management: Theory & Practice
16th Edition
ISBN:9781337909730
Author:Brigham
Publisher:Brigham
Chapter7: Corporate Valuation And Stock Valuation
Section: Chapter Questions
Problem 1P: Ogier Incorporated currently has $800 million in sales, which are projected to grow by 10% in Year 1...
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VWX Inc., has sales of $500,000, net income of $80,000, dividend payout of 50%, total assets of $700,000 and target debt-equity ratio of 1.5. If the company grows at its sustainable growth rate in the coming year, how much new borrowing (to the nearest dollar) will take place?

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