Question
This is regarding 4.7 Leverage ratios: Norton Company has a debt to equity ratio of 1.65, ROA of 11.3 percent and total equity of $1,
This is regarding 4.7 Leverage ratios: Norton Company has a debt to equity ratio of 1.65, ROA of 11.3 percent and total equity of $1, 322, 798. What are the company's equity multiplier, debt ratio and ROE?
The formula says
EM= x (assets) /1,322,798, ROA= 11.3%=x(net income)/total assets, ROE = net income/equity(1,322,796, Debt ratio= total debt/total assets, DE=1.65= total debt/total equity(1,322,796.
Where do you get the assets, net income and total debt from?
4.7 Leverage ratios: Norton Company has a debt to equity ratio of 1.65, ROA of 11.3% and total equity of 1,322,796. What are the company's equity multiplier, debt ratio and ROE
The formula says
EM=x(assets)/1,322,796 -where does the asset amount come from?
ROA=11.3%= x(net income)/total assets- where does net income come from?
ROE= net income/equity(1,322,796
Debt ratio=total debt/total assets
DE=1.65 total debt/total equity (1,322,796), I think I would divide 1.65/1,322,796, is this right?
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