Question
Below are some selected ratios for C Corp, a leading manufacturer and seller of citrus fruits and juices in Orange County . Based on these
Below are some selected ratios for C Corp, a leading manufacturer and seller of citrus fruits and juices in Orange County . Based on these ratios, please answer the following questions.
| Current Ratio | 2.5 | Total Asset Turnover | 0.75 |
| Quick Ratio | 0.67 | Debt Ratio | 0.50 |
| DSO | 30 days | Profit Margin | 5% |
| Inventory Turnover | 3x | Average profit margin for citrus industry Firms optimal debt ratio | 4.8%
50% |
What is the ROE for C Corp?
The company wants to keep its optimal debt ratio, so they will not choose to finance more with debt. Based on the information above, how could Mmmm!Citrus Corp increase its ROE? (Hint: Try to identify a weakness of the companys ratios. Then try to identify which component of the ROE could be improved by strengthening this point.)
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Financial Trading And Investing
Authors: John Teall
1st Edition
0123918804, 978-0123918802
