Upton Computers makes bulk purchases of small computers, stocks them in conveniently located warehouses, ships them to its chain of retail stores, and has a staff to advise customers and help them set up their new computers. Uptons balance sheet as of December 31, 2013, is shown here (millions of dollars):

Cash	$2.50		Accounts payable	11.25
Receivable	35.50		Notes payable	10.00
Inventories	55.00		Line of credit	0.00
Total current assets	93.00		Accruals	9.20
Net fixed assets	27.00		Total current liabilities	30.45
			mortgage	7.00
			Common stock	15.50
			Retained earnings	67.05
Total assets	120.00		Total liabilities and equity	120.00

Sales for 2013 were $375.00 million and net income for the year was $23.50 million, so the firms profit margin was 6.2667%. Upton paid dividends of $4.20 million to common stockholders, so its payout ratio was 51.00%. Its tax rate was 40%, and it operated at full capacity. Assume that all assets/sales ratios, spontaneous liabilities/sales ratios, the profit margin, and the payout ratio remain constant in 2014. b. Using the AFN equation, determine Uptons self-supporting growth rate. That is, what is the maximum growth rate the firm can achieve without having to employ nonspontaneous external funds?

13.08%

10.86%

14.65%

15.30%

12.03%