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Baker Industries' net income is $27000, its interest expense is $5000, and its tax rate is 40%. Its notes payable equals $27000, long-term debt equals $80000, and common equity equals $240000. The firm finances with only debt and common equity, so it has no preferred stock. The data has been collected in the Microsoft Excel Online file below. Open the spreadsheet and perform the required analysis to answer the questions below. X Open spreadsheet What are the firm's ROE and ROIC? Round your answers to two decimal places. Do not round intermediate calculations. ROE ROIC 11.25 % %

Baker Industries' net income is $27000, its interest expense is $5000, and its tax rate is 40%. Its notes payable equals $27000, long-term debt equals $80000, and common equity equals $240000. The firm finances with only debt and common equity, so it has no preferred stock. The data has been collected in the Microsoft Excel Online file below. Open the spreadsheet and perform the required analysis to answer the questions below. X Open spreadsheet What are the firm's ROE and ROIC? Round your answers to two decimal places. Do not round intermediate calculations. ROE ROIC 11.25 % %

Essentials Of Investments
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
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Baker Industries' net income is $27000, its interest expense is $5000, and its tax rate is 40%. Its notes payable equals $27000, long-term debt equals $80000, and common equity equals $240000. The firm finances with only debt and common equity, so it has no preferred stock. The data has been collected in the Microsoft Excel Online file below. Open the spreadsheet and perform the required analysis to answer the questions below. Open spreadsheet What are the firm's ROE and ROIC? Round your answers to two decimal places. Do not round intermediate calculations. ROE ROIC 11.25 % 1%
Transcribed Image Text:Baker Industries' net income is $27000, its interest expense is $5000, and its tax rate is 40%. Its notes payable equals $27000, long-term debt equals $80000, and common equity equals $240000. The firm finances with only debt and common equity, so it has no preferred stock. The data has been collected in the Microsoft Excel Online file below. Open the spreadsheet and perform the required analysis to answer the questions below. Open spreadsheet What are the firm's ROE and ROIC? Round your answers to two decimal places. Do not round intermediate calculations. ROE ROIC 11.25 % 1%
3 A ROE and ROIC Net income Interest expense Tax rate Notes payable 0 ROE 7 8 Long-term debt Common equity V 5 EBT 6 Taxes 2 Partial Income Statement: 3 EBIT 4 Interest Net income X✓ fx =B6+B7+B8 24 25 ROIC 26 27 9 Capital Summary: 0 Notes payable 1 Long-term debt 2 Common equity 3 Total invested capital B $27,000 $5,000 40.00% $27,000 $80,000 $240,000 11.25% $5,000.00 $18,000.00 $27,000.00 $27,000.00 $80,000.00 $240,000.00 $347,000.00 7.78% Formulas =B3/B8 #N/A #N/A =(B3/(1-40%) ) 40% =B6+B7+B8 =(B3/B23) E LLL F G H
Transcribed Image Text:3 A ROE and ROIC Net income Interest expense Tax rate Notes payable 0 ROE 7 8 Long-term debt Common equity V 5 EBT 6 Taxes 2 Partial Income Statement: 3 EBIT 4 Interest Net income X✓ fx =B6+B7+B8 24 25 ROIC 26 27 9 Capital Summary: 0 Notes payable 1 Long-term debt 2 Common equity 3 Total invested capital B $27,000 $5,000 40.00% $27,000 $80,000 $240,000 11.25% $5,000.00 $18,000.00 $27,000.00 $27,000.00 $80,000.00 $240,000.00 $347,000.00 7.78% Formulas =B3/B8 #N/A #N/A =(B3/(1-40%) ) 40% =B6+B7+B8 =(B3/B23) E LLL F G H
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