Question
The DuPont formula relates return on equity (= Net income t Stockholders equity t ) to the company's net profit margin (= Net incomeSales ),
The DuPont formula relates return on equity (=Net incometStockholders equityt) to the company's net profit margin (=Net incomeSales), asset turnover (=SalestTotal assetst), and equity multiplier (=Total assetsStockholders equity).This Company is in an industry where the average net profit margin is 10.65%, the debt-to-asset ratio (=DebtTotal assets) is 41.10%, and return on equity is 47.06%.Find below the Company's financial statements for year 2525.
CA$6,644Debt$5,847Sales$31,111PP&E$7,851SE$8,648total costs$27,867TA$14,495$14,495NI$3,244
thecompany's asset turnover indicates sales are unusually small relative to its assets
thecompany's equity multiplier indicates the firm has an unusually small debt burden
thecompany's profit margin indicates its revenues are unusually small relative to its costs
thecompany's asset turnover indicates sales are unusually large relative to its assets
thecompany's equity multiplier indicates the firm has an unusually large debt burden
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