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Problem 5 (DuPont and ROE)
A firm has a profit margin of 2% and an equity multiplier of 2.0. Its sales are P100 million, and it has total assets of P50 million. What is its ROE?
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- 4. Computer Geeks has sales of $521,000, a profit margin of 14.8%, a total asset turnover rate of 2.16, and an equity multiplier of 1.3. What is the return on equity? a. 8.91% b. 18.28% c. 32.11% d. 41.56% 5Question 11 For this and the next 2 questions: A firm has total assets of $15.4 million and a debt/equity ratio of 0.825. The firm's sales are $11 million, and it has total fixed costs of $4.4 million. Suppose also the firm's EBIT is $2.2 million, its tax rate is 45%, and the interest rate on all of its debt is 10%. How much debt does the firm have on its balance sheet? 1) $8.43836 million 2) $6.96164 million 3) $4.4825 million 4) Not enough information Question 12 Calculate the firm's equity multiplier ratio 1) 0.54795 2) 0.22727 3) 1.825 4) None of the aboveA firm has a profit margin of 2% and an equity multiplier of 2.0. Its sales are $100 million, and it has total assets of $50 million. What is its ROE?
- 1.10 Norwell Inc. has equity with a market value of $900 million and a current debt to capital ratio of 10%. If Norwell has an optimal debt ratio of 40% and would like to borrow money and buy back stock right now, how much additional debt will the firm have to issue? a. $260 million b. $300 million c. $400 million d. $600 million e. None of the aboveSuppose First National Bank has $500 million of assets and $ $75 million of equity capital. If First National Bank has a 5% return on assets (ROA), what is its return on equity (ROE)? A. 35% B. 33.3% C. 25% D. None of the aboveDuPONT ANALYSIS Henderson’s Hardware has an ROA of 11%, a 6% profit margin, and anROE of 23%. What is its total assets turnover? What is its equity multiplier?
- ROE Needham Pharmaceuticals has a profit margin of 3.5% and an equity multiplier of 1.5. Its sales are $100 million and it has total assets of $60 million. What is its Return on Equity (ROE)? Round your answer to two decimal places.J 8, The Time Teller Ltd has a net profit margin of 10,5%, total asset turnover of 1,75 and return on equity (ROE) of 24,50%. What is this company's financial leverage multiplier?A firm wishes to maintain an sustainable growth rate of 10 percent and a dividend payout ratio of 56 percent. The ratio of total assets to sales is constant at 1.1, and the profit margin is 9.6 percent. If the firm also wishes to maintain a constant debt-equity ratio, what must it be? Multiple Choice О 5.86 О 1.37 О 6.86 4.86 3.86
- H3. A firm wishes to maintain an sustainable growth rate of 9 percent and a dividend payout ratio of 64 percent. The ratio of total assets to sales is constant at 0.9, and the profit margin is 10.1 percent. If the firm also wishes to maintain a constant debt-equity ratio, what must it be? Please show proper step by step calculation9. Problem 4.08 (DUPONT and Net Income) eBook Precious Metal Mining has $5 million in sales, its ROE is 18%, and its total assets turnover is 4x. Common equity on the firm's balance sheet is 55% of its total assets. What is its net income? Write out your answer completely. For example, 5 million should be entered as 5,000,000. Do not round intermediate calculations. Round your answer to the nearest cent. $5. A firm has an asset turnover ratio of 2.0. Its plowback ratio is 40%, and it is all equity-financed. What must its profit margin be if it wishes to finance 11% growth using only internally generated funds? if the profit margin of the firm is now found to be 6%, what is the maximum payout ratio that will allow it to grow at 8% without resorting to external financing?