Question
27. Jacob Money Inc. has a profit margin of 11% and a retention ratio of 70%. Last year, the firm had sales of $500 and
27. Jacob Money Inc. has a profit margin of 11% and a retention ratio of 70%. Last year, the firm had sales of $500 and total assets of $1,000. The desired total debt ratio is 75%. What is the firm's sustainable growth rate? A) 7.1% B) 2.5% C) 18.2% D) 4.0% E) 11.3%
31. A Windsor Ontario firm has a net income of $32,000 which provides a 12% return on assets. The firm has a debt-equity ratio of .40. What is the return on equity? A) 12.00% B) 11.67% C) 7.20% D) 8.57% E) 16.80%
32. Using the Du Pont Identity Method, calculate the equity multiplier given the following information: profit margin 14%; total asset turnover 1.7; return on equity 29.08%. A) 1.5 B) 1.4 C) 1.1 D) 1.3 E) 1.2
33. Current assets of the Smart Inc. are $94,700. Accounts payable is $36,200, net income is $12,400 and sales are $110,800. What is the net working capital turnover rate for Smart Inc.? A) 1.68 B) 0.21 C) 1.89 D) 1.17 E) 0.85
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