The newspaper reported last week that Bennington Enterprises earned $28 million this year. The report also stated that the firm�s return on equity is 15 percent. Bennington retains 70 percent of its earnings.

Required:
(a)
What is the firm's earnings growth rate?

(b)
What will firm's next year's earnings be?

a). Firm's growth rate = 10.5%

b). Next year's earnings = $30,940,000.00

Explanation: Earnings growth rate is the percentage change in earnings given specific variables.

The firm's earnings growth rate g = Return on equity (ROE) × Retained earnings (b) = 0.15(0.70)

g =0.105 or 10.5%

In finding next year's earnings, we multiply the current earnings times one plus the growth rate.

Next year's earnings = Current earnings(1 + g)

Next year's earnings = 28,000,000(1 + 0.105)

Next year's earnings = $30,940,000.00

The firm's earnings growth rate is 10.5%

Firm next year's earnings is $30.94 million

Explanation:

The formula for earnings growth rate is given as returns on equity multiplied by retained earnings

return on equity is given as 15%

retained earnings =$28 million *70%

Retained earnings=$19.6 million

Earnings growth rate=70%*15%

Earnings growth rate =10.50%

Firm next year's earnings =this year earnings*(1+earnings growth rate)

Firm next year's earnings =$28m*(1+0.105)

                                            =$30.94 million

Retained earnings next year could be computed $30.94*70%=$21.66 million

Since the earnings next year is believed to increase to $30.94 million, it implies that even though the payout as dividends is not increasing in percentage terms but increasing in dollar terms

the first successful, urban blues recording, selling more than 75,000 copies, was made in year 1920.

mamie smith recorded the first commercially successful example of the urban blues,   with the recording of “crazy blues”."crazy blues" was recorded on august 10, 1920, in new york city. within a month of the release of “crazy blues” it had sold 75,000 copies.