Internal Growth Rate Saddle and Bridle Reported a Profit Margin

Internal Growth Rate Saddle and Bridle reported a profit margin of 12 percent,total asset turnover ratio of 2 times,debt-to-equity ratio of 1.9 times,net income of $1 million,and dividends paid to common stockholders of $250,000.The firm has no preferred stock outstanding.What is Saddle and Bridle's internal growth rate?

A) 13.64 percent
B) 18.00 percent
C) 24.00 percent
D) 21.95 percent

Correct Answer:

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