Question
This year Andrews achieved an ROE of 5.5%. Suppose next year the profit margin (Net Income/Sales) increases. Assuming sales, assets and financial leverage remain the
This year Andrews achieved an ROE of 5.5%. Suppose next year the profit margin (Net Income/Sales) increases. Assuming sales, assets and financial leverage remain the same next year, what effect would you expect this action to have on Andrews's ROE?
| Andrews ROE will increase. | |
| Andrews ROE will decrease. | |
| Andrews ROE will remain the same. |
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The Audit Process Principles Practice And Cases
Authors: Iain Gray, Louise Crawford, Stuart Manson
7th Edition
1473760186, 9781473760189
