Please given answer Accounting question A firm has a profit margin of 15%, on sales of$20,000,000. If the firm has debt of $7,500,000,total assets of $22,500,000, and an after-taxinterest cost, on total debt of 5%, what is thefirm's ROA?

Step 1: Define How to Compute Asset Return?The return on assets is a profitability ratio that…

Answered: A firm has a profit margin of 15%, on…

Intermediate Financial Management (MindTap Course List)

13th Edition

ISBN:9781337395083

Author:Eugene F. Brigham, Phillip R. Daves

Publisher:Eugene F. Brigham, Phillip R. Daves

Chapter22: Providing And Obtaining Credit

Section: Chapter Questions

Problem 2MC

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A firm has a profit margin of 15 percent on sales of $20,000,000. If the firm has debt of $7,500,000, total assets of $22,500,000, and an after-tax interest cost on total debt of 5 percent, what is the firm's ROA? Group of answer choices 8.4% 10.9% 12.0% 13.3% 15.1%
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A firm has a profit margin of 15%, on sales of $20,000,000. If the firm has debt of $7,500,000, total assets of $22,500,000, and an after-tax interest cost, on total debt of 5%, what is the firm's ROA?