Assume the following relationships for the Blake Corp.: • Sales/Total assets = 1.8 • Return on assets (ROA) = 4.5% • Return on equity (ROE) = 6.5% Calculate Blake's profit margin and debt-to-capital ratio, assuming the firm uses only debt and common equity, so total assets equal total invested capital.
Assume the following relationships for the Blake Corp.: • Sales/Total assets = 1.8 • Return on assets (ROA) = 4.5% • Return on equity (ROE) = 6.5% Calculate Blake's profit margin and debt-to-capital ratio, assuming the firm uses only debt and common equity, so total assets equal total invested capital.
Chapter3: Analysis Of Financial Statements
Section: Chapter Questions
Problem 8P
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Transcribed Image Text:Assume the following relationships for the Blake Corp.:
•
Sales/Total assets = 1.8
•
Return on assets (ROA) = 4.5%
•
Return on equity (ROE) = 6.5%
Calculate Blake's profit margin and debt-to-capital ratio,
assuming the firm uses only debt and common equity, so
total assets equal total invested capital.
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