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Rainbow Company has a debt-equity ratio of 1.25. Return on assets is 7.50 percent, and total equity is $625,000. Requirement 1: What is the equity
Rainbow Company has a debt-equity ratio of 1.25. Return on assets is 7.50 percent, and total equity is $625,000. Requirement 1: What is the equity multiplier? a 1.25 times b 6.00 times c 2.25 times d 0.80 times e 0.25 times Requirement 2: What is the return on equity? a 16.88% b 2.25% c 9.38% d 6.25% e 6.00% Requirement 3: What is the net income? a $58,625 b $14,062 c $37,500 d $39,062 e $105,469 Show the work please
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