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Sky Trail Inc. has a profit margin of 18% on sales of $25,000,000. The firm holds $9,000,000 in debt, total assets worth $30,000,000, and pays an after-tax interest cost of 6% on its debt. What is Sky Trail Inc.'s ROA?

Sky Trail Inc. has a profit margin of 18% on sales of $25,000,000. The firm holds $9,000,000 in debt, total assets worth $30,000,000, and pays an after-tax interest cost of 6% on its debt. What is Sky Trail Inc.'s ROA?

Intermediate Financial Management (MindTap Course List)
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 2P: Vigo Vacations has $200 million in total assets, $5 million in notes payable, and $25 million in...
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I need the correct answer to this financial accounting problem using the standard accounting approach.

Sky Trail Inc. has a profit margin of 18% on sales of $25,000,000. The firm holds $9,000,000 in debt, total assets worth $30,000,000, and pays an after-tax interest cost of 6% on its debt. What is Sky Trail Inc.'s ROA?
Transcribed Image Text:Sky Trail Inc. has a profit margin of 18% on sales of $25,000,000. The firm holds $9,000,000 in debt, total assets worth $30,000,000, and pays an after-tax interest cost of 6% on its debt. What is Sky Trail Inc.'s ROA?
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