A firm has a debt-to-asset ratio of 75%, $255,000 in debt, and a net income of $51,000. Calculate return on equity. a. 80% b. 75% c. 76% d. 60%

Principles of Accounting Volume 2
19th Edition
ISBN:9781947172609
Author:OpenStax
Publisher:OpenStax
Chapter12: Balanced Scorecard And Other Performance Measures
Section: Chapter Questions
Problem 7EA: Assume Skyler Industries has debt of $4,500,000 with a cost of capital of 7.5% and equity of...
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A firm has a debt-to-asset ratio of 75%,
$255,000 in debt, and a net income of
$51,000. Calculate return on equity.
a. 80%
b. 75%
c. 76%
d. 60%
Transcribed Image Text:A firm has a debt-to-asset ratio of 75%, $255,000 in debt, and a net income of $51,000. Calculate return on equity. a. 80% b. 75% c. 76% d. 60%
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