$4-3$ DuPONT ANALYSIS Henderson's Hardware has an ROA of $11\%,$ a $6\%$ profit margin, and an ROE of $23\%.$ What is its total assets turnover? What is its equity multiplier?

$4-4$ MARKET$/$BOOK AND EV$/$EBITDA RATIOS Edelman Engines has $$17$ billion in total assets$-$of which cash and equivalents total $$100$ million. Its balance sheet shows $$1\mathrm{.}7$ billion in current liabilities$-$of which the notes payable balance totals $$1$ billion. The firm also has $$10\mathrm{.}2$ billion in long$-$term debt and $$5\mathrm{.}1$ billion in common equity. It has $300$ million shares of common stock outstanding, and its stock price is $$20$ per share. The firm's EBITDA totals $$1\mathrm{.}368$ billion. Assume the firm's debt is priced at par, so the market value of its debt equals its book value. What are Edelman's market$/$book and its EV$/$EBITDA ratios?

$4-5$ PRICE$/$EARNINGS RATIO A company has an EPS of $$2\mathrm{.}40,$ a book value per share of $$21\mathrm{.}84,$ and a market$/$book ratio of $2\mathrm{.}7.$ What is its $\frac{P}{E}$ ratio?

$4-6$ DuPONT AND ROE A firm has a profit margin of $3\%$ and an equity multiplier of $1\mathrm{.}9.$ Its sales are $$150$ million, and it has total assets of $$60$ million. What is its ROE?

Intermediate

Problems

$7-19$

ROE AND ROIC Baker Industries's net income is $$24,000,$ its interest expense is $$5,000,$ and its tax rate is $25\%.$ Its notes payable equals $$27,000,$ long$-$term debt equals $$75,000,$ and common equity equals $$250,000.$ The firm finances with only debt and common equity, so it has no preferred stock. What are the firm's ROE and ROIC?