Question
The return on equity for MMM corporation is 10% for 2017 and profits after taxes are $40,000. Number of shares outstanding are 100,000 and the
The return on equity for MMM corporation is 10% for 2017 and profits after taxes are $40,000. Number of shares outstanding are 100,000 and the market price of the share is $8. Total liabilities for the company are $600,000. Please answer the following questions a. Please calculate the equity capital of the company. Describe the significance of the ratio return on equity and how it is being used by investors . Then calculate the debt to assets ratio and explain its meaning and significance to investors. In addition calculate the price-earnings ratio of MMM and explain its meaning and significance to investors?
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Earnings Quality
Authors: Andrew P.C.
1st Edition
1521507724, 978-1521507728
