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A firm has a total debt ratio of 50%, total debt of $500,000, and net income of $65,000. What is the firm's return on equity (ROE)? a) 12.50% b) 15.80% c) 13.00% d) 14.75%

A firm has a total debt ratio of 50%, total debt of $500,000, and net income of $65,000. What is the firm's return on equity (ROE)? a) 12.50% b) 15.80% c) 13.00% d) 14.75%

Intermediate Financial Management (MindTap Course List)
Intermediate Financial Management (MindTap Course List)
13th Edition
ISBN:9781337395083
Author:Eugene F. Brigham, Phillip R. Daves
Publisher:Eugene F. Brigham, Phillip R. Daves
Chapter7: Analysis Of Financial Statements
Section: Chapter Questions
Problem 6P
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A firm has a total debt ratio of 50%, total debt of $500,000, and net income of $65,000. What is the firm's return on equity (ROE)? a) 12.50% b) 15.80% c) 13.00% d) 14.75%
Transcribed Image Text:A firm has a total debt ratio of 50%, total debt of $500,000, and net income of $65,000. What is the firm's return on equity (ROE)? a) 12.50% b) 15.80% c) 13.00% d) 14.75%
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