Question
Using the Du Pont method, evaluate the effects of the following relationships for the Butters Corporation. a. Butters Corporation has a profit margin of 6.5
Using the Du Pont method, evaluate the effects of the following relationships for the Butters Corporation.
a. Butters Corporation has a profit margin of 6.5 percent and its return on assets (investment) is 16.5 percent. What is its assets turnover? (Round your answer to 2 decimal places.)
b. If the Butters Corporation has a debt-to-total-assets ratio of 50.00 percent, what would the firms return on equity be? (Input your answer as a percent rounded to 2 decimal places.)
c. What would happen to return on equity if the debt-to-total-assets ratio decreased to 35.00 percent? (Input your answer as a percent rounded to 2 decimal places.)
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