Oscar's Dog House has a net profit of $56,000 and sales of 1,000,000. It has total assets of $8,000,000. Its book value/equity is $5,300,000 and it pays out 35% of earnings as dividends. Required: a. What's its net profit margin, equity multiplier, and total asset turnover ratio? b. What is the return on equity using the DuPont Identity formula?

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
icon
Related questions
Question

Hi expart Provide solution

Oscar's Dog House has a net profit of $56,000
and sales of 1,000,000. It has total assets of
$8,000,000. Its book value/equity is $5,300,000
and it pays out 35% of earnings as dividends.
Required:
a. What's its net profit margin, equity multiplier,
and total asset turnover ratio?
b. What is the return on equity using the DuPont
Identity formula?
Transcribed Image Text:Oscar's Dog House has a net profit of $56,000 and sales of 1,000,000. It has total assets of $8,000,000. Its book value/equity is $5,300,000 and it pays out 35% of earnings as dividends. Required: a. What's its net profit margin, equity multiplier, and total asset turnover ratio? b. What is the return on equity using the DuPont Identity formula?
Expert Solution
steps

Step by step

Solved in 2 steps

Blurred answer
Similar questions
  • SEE MORE QUESTIONS
Recommended textbooks for you
Intermediate Financial Management (MindTap Course…
Intermediate Financial Management (MindTap Course…
Finance
ISBN:
9781337395083
Author:
Eugene F. Brigham, Phillip R. Daves
Publisher:
Cengage Learning