A firm has a profit margin of 19 percent on sales of $24,000,000. If the firm has total assets of $23,500,000, and an after-tax interest cost on total debt of 5 percent, what is the firm's ROA? a. 12.9% b. 19.4% c. 12.0% d. 13.3% e. 15.1%
A firm has a profit margin of 19 percent on sales of $24,000,000. If the firm has total assets of $23,500,000, and an after-tax interest cost on total debt of 5 percent, what is the firm's ROA? a. 12.9% b. 19.4% c. 12.0% d. 13.3% e. 15.1%
Chapter13: Capital Structure Concepts
Section: Chapter Questions
Problem 6P
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Transcribed Image Text:A firm has a profit margin of 19 percent on sales of
$24,000,000. If the firm has total assets of $23,500,000,
and an after-tax interest cost on total debt of 5 percent,
what is the firm's ROA?
a. 12.9%
b. 19.4%
c. 12.0%
d. 13.3%
e. 15.1%
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