Please help!
Balance Sheet Data Income Statement Data Cash $1,200,000 $1,440,000 Sales $24,000,000 Accounts payable Accounts receivable Cost of goods sold 2,400,000 Accruals 480,000 12,000,000 Notes payable Inventory 3,600,000 1,920,000 Gross profit 12,000,000 Current assets 3,840,000 7,200,000 Current liabilities Operating expenses 6,000,000 BIT Long-term debt 6,240,000 6,000,000 Interest expense 979,200 Total liabilities 10,080,000 Common stock 1,680,000 EBT 5,020,800 Retained earnings Net fixed assets 9,600,000 5,040,000 Taxes 1,255,200 Total equity Net income 6,720,000 $3,765,600 Total assets $16,800,000 Total debt and equity $16,800,000 the total asset If I remember correctly, the DuPont equation breaks down our ROE into three component ratios: the turnover ratio, and the And, according to my understanding of the DuPont equation and its calculation of ROE, the three ratios provide insights into the company's effectiveness in using the company's assets, and Now, let's see your notes with your ratios, and then we can talk about possible strategies that will improve the ratios. I'm going to check the box to the side of your calculated value if your calculation is correct and leave it unchecked if your calculation is incorrect. Hydra Cosmetics Inc. DuPont Analysis Ratios Value Correct/Incorrect Ratios Value Correct/Incorrect Profitability ratios Asset management ratio Gross profit margin (%) 50.00 Total assets turnover 1.43 Operating profit margin (%) 20.92 Net profit margin (%) 22.41 Financial ratios Return on equity (% 53,52 Equity multiplier 1.67 Hydra Cosmetics Inc. DuPont Analysis Calculation Value Ratios Profitability ratios Numerator Denominator Gross profit margin (% Operating profit margin (%) Net profit margin (%) Return on equity (% Asset management ratio Total assets turnover Financial ratios Equity multiplier JASON: I see what I did wrong in my computations. Thanks for reviewing these calculations with me. You saved me from a lot of had showed my original work embarras Anja would been very disappointed in me So, now let's switch topics and identify general strategies that could be used to positively affect Hydra's ROE. YOU: OK, so given your knowledge of the component ratios used in the DuPont equation, which of the following strategies should improve the company's ROE? Check all that apply. Increase the interest rate on its notes payable or long-term debt obligations because it will reduce the company's net profit margin. Use more debt financing in its capital structure and increase the equity multiplier. Increase the firm's bottom-line profitability for the same volume of sales, which will increase the company's net profit margin. Reduce the company's operating expenses, its cost of goods sold, and/or the interest rate on its borrowed funds because this will increase the company's net profit margin
