Solution-If major manuscripts inc decides to maintain

If major manuscripts inc decides to maintain constant

Reference no: EM13478621

Major Manuscripts, Inc. 2012 Income Statement
Net sales	$	8,800
Cost of goods sold		7,265
Depreciation		320
Earnings before interest and taxes	$	1,215
Interest paid		80
Taxable Income	$	1,135
Taxes		405
Net income	$	730
Dividends	$	292

Major Manuscripts, Inc. 2012 Balance Sheet
	2012			2012
Cash	$	2,270	Accounts payable	$	1,170
Accounts rec.		980	Long-term debt		380
Inventory		3,700	Common stock	$	3,900
Total	$	6,950	Retained earnings		5,230
Net fixed assets		3,730
Total assets	$	10,680	Total liabilities & equity	$	10,680

If Major Manuscripts, Inc., decides to maintain a constant debt-equity ratio, what rate of growth can it maintain assuming that no additional external equity financing is available?

a) 5.04 percent
b) 9.14 percent
c) 7.83 percent
d) 4.58 percent
e) 4.28 percent

Reference no: EM13478621

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If major manuscripts inc decides to maintain constant

Reference no: EM13478621

Reference no: EM13478621

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