Intro

Esport Electronics expects the following numbers for next year:

Sales: $$2,000,000$

Costs: $$1,400,000($excluding depreciation$)$

Depreciation: $$200,000$

Interest: $100,000$

Tax rate: $26\%$

Total asset turnover: $3$

Total debt ratio: $40\%$

Part $1$

What is the expected profit margin?

Part $2$

What is the expected equity multiplier?

Part $3$

What is the expected return on equity?