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I need the solution for these questions please! Thank you! 1. (15 points) The extended Du Pont equation may be defined as: ROE = profit
I need the solution for these questions please! Thank you!
1. (15 points) The extended Du Pont equation may be defined as: ROE = profit margin x total assets turnover ratio x equity multiplier = (net income/sales) x (sales/total assets) x (total assets/common equity) Income statement and balance sheet for Barry Computer Company are given in Table A below. Based on information given here and Table A, a. Fill in the gaps in the following table and comment on the performance of Barry Computer relative to its peers. Ratio Barry Industry Average Current assets/current liabilities 2.Ox 35 days Days' sales outstanding Sales/inventory 6.7x Sales/fixed assets 12.1x Sales/total assets 3.0x Net income/sales 1.2% Net income/total assets 3.6% Net income/common equity 9.0% Total debt/total assets 60% Assume a 365-day year. b. Construct the extended Du Pont equation for both Barry and the industryStep by Step Solution
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