Can you please give correct answer for this accounting question? Firm A and Firm B have debt-totalasset ratios of 36% and 26% andreturns on total assets of 8% and12%, respectively. What is the returnon equity for Firm A and Firm B?

Step 1: Define Debt-Total Assets RatioDebt to Total Assets Ratio is the ratio which represents the…

Answered: Firm A and Firm B have debt-total asset…

Entrepreneurial Finance

6th Edition

ISBN:9781337635653

Author:Leach

Publisher:Leach

Chapter5: Evaluating Operating And Financial Performance

Section5.4: Leverage Ratios

Problem 1CC

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Firm A and Firm B have debt-total asset ratios of 36% and 26% and returns on total assets of 8% and 12%, respectively. What is the return on equity for Firm A and Firm B?