McCormac Co. wishes to maintain a growth rate of 8 percent a year, a debt-equity ratio...

McCormac Co. wishes to maintain a growth rate of 8 percent a year, a debt-equity ratio of 0.41, and a dividend payout ratio of 64 percent. The ratio of total assets to sales is constant at 1.29. Required: What profit margin must the firm achieve?

Solutions

Expert Solution

calculations-

Please upvote if the ans is helpful.In case of doubt,do comment.Thanks.

jeff jeffy answered 1 year ago

Next > < Previous

Related Solutions

Abacus Co. wishes to maintain a growth rate of 14 percent a year, a debt–equity ratio...

Abacus Co. wishes to maintain a growth rate of 14 percent a year, a debt–equity ratio of 1.4, and a dividend payout ratio of 26 percent. The ratio of total assets to sales is constant at 0.8. What profit margin must the firm achieve? (in %) (round 2 decimal places)

Abacus Co. wishes to maintain a growth rate of 14 percent a year, a debt–equity ratio...

Abacus Co. wishes to maintain a growth rate of 14 percent a year, a debt–equity ratio of 1.3, and a dividend payout ratio of 25 percent. The ratio of total assets to sales is constant at 0.6. What profit margin must the firm achieve? (in %)

Co. wishes to maintain a growth rate of 11 percent a year, adebt–equity ratio of...

Co. wishes to maintain a growth rate of 11 percent a year, a debt–equity ratio of 1.7, and a dividend payout ratio of 30 percent. The ratio of total assets to sales is constant at 0.7.What profit margin must the firm achieve? (in %) (round 4 decimals)

Ramble On Co. wishes to maintain a growth rate of 7 percent a year, a debt-equity...

Ramble On Co. wishes to maintain a growth rate of 7 percent a year, a debt-equity ratio of 0.31, and a dividend payout ratio of 66 percent. The ratio of total assets to sales is constant at 1.27. What profit margin must the firm achieve?

Ramble On Co. wishes to maintain a growth rate of 10 percent a year, a debt-equity...

Ramble On Co. wishes to maintain a growth rate of 10 percent a year, a debt-equity ratio of 0.35, and a dividend payout ratio of 62 percent. The ratio of total assets to sales is constant at 1.33. What profit margin must the firm achieve? A. 13.42% B. 14.55% C. 23.82% D. 23.57% E. 8.17%

Ramble On Co. wishes to maintain a growth rate of 9 percent a year, a debt-equity...

Ramble On Co. wishes to maintain a growth rate of 9 percent a year, a debt-equity ratio of 0.33, and a dividend payout ratio of 62 percent. The ratio of total assets to sales is constant at 1.38. What profit margin must the firm achieve? 

Ramble On Co. wishes to maintain a growth rate of 9 percent a year, a debt-equity...

Ramble On Co. wishes to maintain a growth rate of 9 percent a year, a debt-equity ratio of 0.49, and a dividend payout ratio of 56 percent. The ratio of total assets to sales is constant at 1.25. What profit margin must the firm achieve?

Company A wants to maintain a growth rate of 8 percent a year, a debt-equity ratio...

Company A wants to maintain a growth rate of 8 percent a year, a debt-equity ratio of 0.47, and a dividend payout ratio of 58 percent. The ratio of total assets to sales is constant at 1.34. What profit margin must the firm achieve? Hint: If we find the ROE, we can solve the DuPont identity for profit margin. We can calculate ROE from the sustainable growth rate equation.

Ramble On Co. wishes to maintain a growth rate of 11.4 percent per year, a debt-equity...

Ramble On Co. wishes to maintain a growth rate of 11.4 percent per year, a debt-equity ratio of 1.5, and a dividend payout ratio of 30 percent. The ratio of total assets to sales is constant at .87. What profit margin must the firm achieve? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.)

Ramble On Co. wishes to maintain a growth rate of 11 percent per year, a debt-equity...

Ramble On Co. wishes to maintain a growth rate of 11 percent per year, a debt-equity ratio of 1.3, and a dividend payout ratio of 35 percent. The ratio of total assets to sales is constant at .85. What profit margin must the firm achieve? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.)

Subjects