A firm has a profit marginof 15 percent on sales ofGHS20,000,000. If the firmhas debt of GHS7,500,000,total assets ofGHS22,500,000, and anafter-tax interest cost ontotal debt of 5 percent,what is the firm?s ROA?O A. 8.4%B. 10.9%OC. 12.0%D. 13.3%E. 15.1%

Return on Assets (ROA) is an important tool used by the business for determining the profitability…

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what is the firm?s ROA?

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

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A firm has a profit margin of 15 percent on sales of $20,000,000. If the firm has debt of $7,500,000, total assets of $22,500,000, and an after-tax interest cost on total debt of 5 percent, what is the firm's ROA? Group of answer choices 8.4% 10.9% 12.0% 13.3% 15.1%
Choose the correct letter of answer: The following data applies to a firm: Interest Charges P10 Million, Sales/CGS P80 Million, Tax Rate 50% and Net profit margin 10%. What is the firm's interest covered ration? a. 1.6b. 2.6c. 3.6d. 4.6e. 5.6
You are analysing NBM firm and obtained the following information: FCFF reported as R198 million, interest expense is R15 million. If the tax rate is 35% and the net debt of the firm increased by R20 million, what is the approximate market value of the firm if the FCFE grows at 3% and the cost of equity is 14%? R1,950 billion R2,497 billion R2,585 billion R3,098 billion R 1,893 billion
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A firm has a profit margin of 15% on sales of $20,000,000. If the firm has debt of $7,500,000, total assets of $22,500.00, and a after-tax interest cost on total debt of 5%, what is the firm's ROA?
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