Given the information in the table on KMS

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, did KMS's expansion plan call for it to grow slower or faster than its sustainable growth rate?

The Tax Cuts and Jobs Act of 2017 temporarily allows 100% bonus depreciation (effectively expensing capital expenditures). However, we will still include depreciation forecasting in this chapter and in these problems in anticipation of the return of standard depreciation practices during your career.

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Part 1

The actual growth rate for

2020

is

enter your response here%.

(Round to two decimal places.)

Part 2

The actual growth rate for

2021

is

enter your response here%.

(Round to two decimal places.)

Part 3

The actual growth rate for

2022

is

enter your response here%.

(Round to two decimal places.)

Part 4

The actual growth rate for

2023

is

enter your response here%.

(Round to two decimal places.)

Part 5

The actual growth rate for

2024

is

enter your response here%.

(Round to two decimal places.)

Part 6

The sustainable growth rate for

2020

is

enter your response here%.

(Round to two decimal places.)

Part 7

The sustainable growth rate for

2021

is

enter your response here%.

(Round to two decimal places.)

Part 8

The sustainable growth rate for

2022

is

enter your response here%.

(Round to two decimal places.)

Part 9

The sustainable growth rate for

2023

is

enter your response here%.

(Round to two decimal places.)

Part 10

The sustainable growth rate for

2024

is

enter your response here%.

(Round to two decimal places.)

Part 11

KMS's expansion calls for it to grow

faster

slower

than its sustainable growth rate.(Select from the drop-down menu.)

	2019	2020	2021	2022	2023	2024
Income Statement (000)
Sales	$74,889	$88,369	$103,247	$119,793	$138,167	$158,546
Cost of Goods Sold	58,413	68,928	80,533	93,439	107,770	123,666
EBITDA	$16,476	$19,441	$22,714	$26,354	$30,397	$34,880
Depreciation	5,492	7,443	7,498	7,549	7,594	7,634
EBIT	$10,984	$11,998	$15,216	$18,805	$22,803	$27,246
Interest Expense	306	306	1,666	1,666	1,666	1,666
Pre-tax Income	$10,678	$11,692	$13,550	$17,139	$21,137	$25,580
Taxes	2,670	2,923	3,388	4,285	5,284	6,395
Net Income	$8,008	$8,769	$10,162	$12,854	$15,853	$19,185
Payout Ratio	30%
Additions to shareholder equity	$5,606	$6,138	$7,113	$8,998	$11,097	$13,430
Beginning shareholder equity		74,134	80,272	87,385	96,383	107,480