Question
Broward Manufacturing recently reported the following information: Net income $765,000 ROA 7% Interest expense $244,800 Accounts payable and accruals $950,000 Broward's tax rate is 30%.
Broward Manufacturing recently reported the following information:
Net income | $765,000 |
ROA | 7% |
Interest expense | $244,800 |
Accounts payable and accruals | $950,000 |
Broward's tax rate is 30%. Broward finances with only debt and common equity, so it has no preferred stock. 40% of its total invested capital is debt, while 60% of its total invested capital is common equity. Calculate its basic earning power (BEP), its return on equity (ROE), and its return on invested capital (ROIC). Round your answers to two decimal places.
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Fundamentals Of Financial Management
Authors: Eugene F. Brigham, Joel F. Houston
16th Edition
0357517571, 978-0357517574
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