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The Return on Sales (ROS) of Alpha Corp is 6%. Alpha's debt ratio (Debt to Assets) is 0.5, and Asset Turnover (Sales to Assets) is 4x. What is Alpha's Return on Equity (ROE)? a) 24% b) 15% c) 30% d) 12% e) none of the above

The Return on Sales (ROS) of Alpha Corp is 6%. Alpha's debt ratio (Debt to Assets) is 0.5, and Asset Turnover (Sales to Assets) is 4x. What is Alpha's Return on Equity (ROE)? a) 24% b) 15% c) 30% d) 12% e) none of the above

EBK CONTEMPORARY FINANCIAL MANAGEMENT
EBK CONTEMPORARY FINANCIAL MANAGEMENT
14th Edition
ISBN:9781337514835
Author:MOYER
Publisher:MOYER
Chapter3: Evaluation Of Financial Performance
Section: Chapter Questions
Problem 8P
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The Return on Sales (ROS) of Alpha Corp is 6%. Alpha's debt ratio (Debt to Assets) is 0.5, and Asset Turnover (Sales to Assets) is 4x. What is Alpha's Return on Equity (ROE)? a) 24% b) 15% c) 30% d) 12% e) none of the above
Transcribed Image Text:The Return on Sales (ROS) of Alpha Corp is 6%. Alpha's debt ratio (Debt to Assets) is 0.5, and Asset Turnover (Sales to Assets) is 4x. What is Alpha's Return on Equity (ROE)? a) 24% b) 15% c) 30% d) 12% e) none of the above
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