ABC Ltd. has a return on equity of 18%. The net profit margin is 8%, and the debt-to-equity ratio is 0.8. What is ABC's return on assets? A) 5.5% B) 10% C) 12% D) 15%

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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I am looking for the correct answer to this general accounting question with appropriate explanations.

ABC Ltd. has a return on equity of 18%. The net
profit margin is 8%, and the debt-to-equity ratio is
0.8. What is ABC's return on assets?
A) 5.5%
B) 10%
C) 12%
D) 15%
Transcribed Image Text:ABC Ltd. has a return on equity of 18%. The net profit margin is 8%, and the debt-to-equity ratio is 0.8. What is ABC's return on assets? A) 5.5% B) 10% C) 12% D) 15%
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