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Problem 9-13 Two firms have sales of $1.5 million each. Other financial information is as follows: Firm A B EBIT$290,000$290,000Interest expense40,00055,000Income tax60,00035,000Debt2,440,0003,330,000Equity1,360,0001,670,000 What are the
Problem 9-13
Two firms have sales of $1.5 million each. Other financial information is as follows:
FirmABEBIT$290,000$290,000Interest expense40,00055,000Income tax60,00035,000Debt2,440,0003,330,000Equity1,360,0001,670,000What are the operating profit margins and the net profit margins for these two firms? Round your answers to two decimal places.
Operating profit margins:
Firm A: %
Firm B: %
Net profit margins:
Firm A: %
Firm B: %
What are their returns on assets and on equity? Round your answers to two decimal places.
Return on assets:
Firm A: %
Firm B: %
Return on equity:
Firm A: %
Firm B: %
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