Suppose that Acme Inc. had a net income of $20,000 on sales of $325,000 and total assets are $240,000 at the end of the fiscal year. The firm's debt to assets ratio was 45.0%. What is the return on equity? (Hint: use the DuPont relationship and change debt/assets to equity/assets, and finally to assets/equity) A. 13.82% B. 14.47% C. 15.15% D. 15.86% E. 15.27%

Suppose that Acme Inc. had a net income of $20,000 on sales of $325,000 and total assets are $240,000 at the end of the fiscal year. The firm's debt to assets ratio was 45.0%. What is the return on equity? (Hint: use the DuPont relationship and change debt/assets to equity/assets, and finally to assets/equity) A. 13.82% B. 14.47% C. 15.15% D. 15.86% E. 15.27%

Managerial Accounting: The Cornerstone of Business Decision-Making

7th Edition

ISBN:9781337115773

Author:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger

Publisher:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger

Chapter15: Financial Statement Analysis

Section: Chapter Questions

Problem 50E: Juroe Company provided the following income statement for last year: Juroes balance sheet as of...

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Juroe Company provided the following income statement for last year: Juroes balance sheet as of December 31 last year showed total liabilities of 10,250,000, total equity of 6,150,000, and total assets of 16,400,000. Required: Note: Round answers to two decimal places. 1. Calculate the times-interest-earned ratio. 2. Calculate the debt ratio. 3. Calculate the debt-to-equity ratio.
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Las year Justine Corp. had sales of P315,000 and a net income of P17,382, and its year-end assets were P210,000. Justine's total debt to total assets ratio was 42.5%. Based on the Du Pont equation, what was Justine's return on equity (ROE)?
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