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Inc. has sales of $ 2 5 0 , 0 0 0 , a net income of $ 1 7 , 5 0 0
Inc. has sales of $ a net income of $ and the following balance sheet : Accounts payable Receivables Notes payable to bank Inventories Total current liabilities $ Total current assets $ Longterm debt Net fixed assets Common equity Total assets $ Total liabilities and equity $ The new owner thinks that inventories are excessive and can be lowered to the point where the current ratio is equal to the industry average x without affecting sales or net income If inventories are sold and not replaced thus reducing the current ratio to x the funds generated are used to reduce common equity stock can be repurchased at book value and if no other changes occur by how much will the ROE change Do not round intermediate calculations Round your answer to two decimal places ROE boxed lnoreaue t odot odot by Box in percentage points What will be the new quick ratio? Do not round intermediate calculations Round your answer to two decimal places Thetax
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