
FINANCIAL ACCOUNTING
10th Edition
ISBN: 9781259964947
Author: Libby
Publisher: MCG
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Transcribed Image Text:Frank's Used Cars has sales of
$807,200, total assets of $768,100,
and a profit margin of 6.68 percent.
The firm has a total debt ratio of 54
percent. What is the return on
equity?
A) 13.09 percent
B) 12.04 percent
C) 11.03 percent
D) 8.56 percent
E) 15.26 percent
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- What is the return on assets?arrow_forwardPlease provide solutionarrow_forwardUsing the DuPont method, evaluate the effects of the following relationships for the Butters Corporation. a. Butters Corporation has a profit margin of 5.5 percent and its return on assets (investment) is 15.5 percent. What is its assets turnover? Note: Round your answer to 2 decimal places. Assets turnover ratio b. If the Butters Corporation has a debt-to-total-assets ratio of 25.00 percent, what would the firm's return on equity be? Note: Input your answer as a percent rounded to 2 decimal places. Return on equity % Return on equity times c. What would happen to return on equity if the debt-to-total-assets ratio decreased to 20.00 percent? Note: Input your answer as a percent rounded to 2 decimal places. $arrow_forward
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