In response to complaints about high prices, a grocery chain runs the following advertising campaign: “If you pay your child $1 to go buy $32 worth of groceries, then your child makes about twice as much on the trip as we do.” You’ve collected the following information from the grocery chain’s financial statements: (millions) Sales $ 764.00 Net income 11.95 Total assets 345.00 Total debt 155.00 a. What is the child’s profit margin? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) b. What is the store’s profit margin? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) c. What is the store's ROE? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.)
In response to complaints about high prices, a grocery chain runs the following advertising campaign: “If you pay your child $1 to go buy $32 worth of groceries, then your child makes about twice as much on the trip as we do.” You’ve collected the following information from the grocery chain’s financial statements: (millions) Sales $ 764.00 Net income 11.95 Total assets 345.00 Total debt 155.00 a. What is the child’s profit margin? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) b. What is the store’s profit margin? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) c. What is the store's ROE? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.)
Chapter24: Multistate Corporate Taxation
Section: Chapter Questions
Problem 15DQ
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In response to complaints about high prices, a grocery chain runs the following advertising campaign: “If you pay your child $1 to go buy $32 worth of groceries, then your child makes about twice as much on the trip as we do.” You’ve collected the following information from the grocery chain’s financial statements: |
| (millions) | ||
| Sales | $ | 764.00 |
| Net income | 11.95 | |
| Total assets | 345.00 | |
| Total debt | 155.00 | |
| a. |
What is the child’s profit margin? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) |
| b. | What is the store’s profit margin? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) |
| c. | What is the store's ROE? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) |
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