To calculate sustainable growth rate without using return on equity,the analyst needs the:
A) profit margin.
B) payout ratio.
C) debt-to-equity ratio.
D) total asset turnover.
E) All of

Question

Quizplus · Accepted Answer

Sustainable growth rate can be calculated as the product of the retention ratio (1 - payout ratio), profit margin, and total asset turnover. Therefore, all of the given options (profit margin, payout ratio, debt-to-equity ratio, and total asset turnover) are needed to calculate the sustainable growth rate without using return on equity.

To Calculate Sustainable Growth Rate Without Using Return on Equity,the