A firm has a debt to equity ratio of 40%, debt of $600,000, and net income of $100,000. What is the return on equity?

Q: A bank with $10,000 in assets has ROA =2% and ROE - 10%. What is its leverage ratio (TA/Equity)?…

A: ROA and ROE for a bank are known. Equity multiplier or the leverage ratio (TA/Equity) needs to be…

Q: Suppose a firm pays total dividends of $35,000 out of net income of $200,000. What would the firm's…

A: Total dividends= $35,000 Net income= $200,000 Firm's payout ratio=?

Q: O'Brien Inc. has the following data: rRF = 5.00%; RPM = 9.00%; and b = 0.65. What is the firm's cost…

A: CAPM is capital asset pricing model which is used for calculating expected returns. Under this, risk…

Q: 4. A firm has a debt-total asset ratio of 75 percent, net income 20 million and total assetsAED 800…

A: The return on equity is calculated as net income divided by shareholders' equity.

Q: Given the information below, which firm has the greatest Return on Equity? Jones Group, Inc Deep…

A: As per Du pont return on equity is calculated with the help of following formula Return on Equity =…

Q: Bank ABC has a Return on Equity (ROE) equal to 24%, an equity/debt ratio equal to 0.05 and an asset…

A: ROE is equal to profit margin multiplied by asset utilisation ratio multiplied by financial…

Q: A business has a cost of equity of 9.5 percent and a pretax cost of debt of 5.4 percent. The…

A: The unlevered cost of capital is the rate of return which a company expects to earn on its assets…

Q: 2. What would be the WACC if the company in question 1 changed its debt-to-equity ratio to zero?

A: The debt to equity ratio is the proportion of debt of total equity in total invested capital. It is…

Q: A firm has a debt-to-equity ratio of 1.20. If it had no debt, its cost of equity would be 15%. Its…

A: The question gives the following information:

Q: Suppose a firm pays total dividends of $696,000 out of net income of $2.4 million. What would the…

A: Companies pay dividends to its shareholders from its profits.The quantum of dividends is decided by…

Q: A firm has a cost of debt of 6.5 percent and a cost of equity of 10.1 percent. The debt–equity ratio…

A: Solution:Weighted Average Cost of Capital (WACC) means the average cost of capital for the firm…

Q: concatti corporation hired your consulting firm to help them estimate the cost of equity. the yeild…

A: Bond yield plus risk premium approach:The estimate of the firms cost of equity from retained…

Q: Using the Du Pont method, evaluate the effects of the following relationships for the Butters…

A: a). Return on assets = Profit margin×Asset turnover Therefore, Asset turnover = Return on…

Q: A firm’s current balance sheet is as follows: Assets $ 110   Debt $ 22         Equity $ 88…

A: Part 2: Explanation:Weighted-average cost of capital (WACC) Analysis: Firstly, we compute the WACC…

Q: O'Brien Inc. has the following data: TRF = 5.00 % ; RPM = 6.00% ; and b = 1.10. What is the firm's…

A: Cost of equity - The amount of return needed by a business for a project or investment, or by an…

Q: Solve this Problem

A: The problem requires the determination of net income. Net income pertains to the amount of…

Q: The Merriam Company has determined that its return on equity is 15 percent. Management is interested…

A: Profit margin is the ratio between net income and sales revenue. It is calculated by dividing net…

Q: Needham Pharmaceuticals has a profit margin of 3.5% and an equity multiplier of 1.5. Its sales are…

A: Profit margin = 3.50% Equity multiplier = 1.50 Sales= $100 Total assets = $60 million

Q: King, Inc. has sales of $900,200, total assets of $1,200,100, and a profit margin of 10.68 percent.…

A: Step 1 Return on Equity The ratio of a company's net income to the equity of its shareholders is…

Q: A financial analyst wants to compute a company's weighted average cost of capital (WACC) using the…

A: WACC means weighted average cost of capital .It is computed as follows:-WACC =…

Q: What is the equity multiplier if the total assets are $9,878.20 and total shareholder equity is…

A: Information Provided: Total assets = $9878.20 Total share holder equity = $6230.20