Can you explain the correct approach to solve this general accounting question? A company has a profit margin of 10% on sales of$15,000,000. The firm has total assets of $18,000,000and total debt of $6,000,000, with an after-tax interestrate of 4% on that debt.What is the company's Return on Assets (ROA)?

Step 1: Definition of Return on Assets (ROA)Return on Assets (ROA) is a profitability ratio that…

Answered: A company has a profit margin of 10% on…

EBK CONTEMPORARY FINANCIAL MANAGEMENT

14th Edition

ISBN:9781337514835

Author:MOYER

Publisher:MOYER

Chapter3: Evaluation Of Financial Performance

Section: Chapter Questions

Problem 13P

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You have the following data for a company. What is the return on assets (ROA)? Return on equity = 15%; Earnings before taxes = $150,000; Total asset turnover = 1.8; Profit margin = 10.5%; Tax rate = 30%.
what is the firm's return on assets?
A business has a profit margin of 18% on total sales of $50,000,000. The firm holds total debt of $15,000,000, total assets of $60,000,000, and an after-tax interest cost on total debt of 6%. Determine the firm's Return on Assets (ROA).
What is the firm's ROA?
What is the firm's Return on Assets (ROA)?
A manufacturing company has a profit margin of 12% on sales of $18,000,000. The firm has total assets of $25,000,000 and total debt of $8,000,000. The after-tax interest cost on total debt is 4.5%. What is the firm's Return on Assets (ROA)? A) 9.88% B) 8.64% C) 10.12% D) 7.92%
Answer
Anderson Enterprises has a profit margin of 5.8% on total sales of $30,200,000. The company's total assets amount to $18,500,000, and its total debt is $9,200,000. What is the firm's Return on Assets (ROA)?
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Timberline Tools has annual sales of $745,800, total debt of $204,000, total equity of $396,000, and a profit margin of 5.6 percent. What is the return on assets (ROA)?
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A company has a profit margin of 10% on sales of $15,000,000. The firm has total assets of $18,000,000 and total debt of $6,000,000, with an after-tax interest rate of 4% on that debt. What is the company's Return on Assets (ROA)?