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Scott Kelly is reviewing MasterToys financial statements in order to

Scott Kelly is reviewing MasterToys financial statements in order to estimate its sustainable growth rate. Consider the

Question:

Scott Kelly is reviewing MasterToyâ€™s financial statements in order to estimate its sustainable growth rate. Consider the information presented in the following exhibit.

MasterToy, Inc.: Actual 2008 and estimated 2009 financial statements for fiscal year ending December 31 ($ millions, except per-share data)

a. Identify and calculate the components of the DuPont formula.
b. Calculate the ROE for 2009 using the components of the DuPont formula.
c. Calculate the sustainable growth rate for 2009 from the firmâ€™s ROE and plowbackratios.

Financial Statements
Financial statements are the standardized formats to present the financial information related to a business or an organization for its users. Financial statements contain the historical information as well as current period’s financial...

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2008 Change (%) Income Statement 76% Selling, general, and administrative 0 8.4 8.6 Averages shares outstanding (millions) Net property, plant, and equipment Total liabilities and equity 5 Annual dividend per share

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Question Posted: Jan 04, 2013 08:00 AM

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