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 4.5
Using the Du Pont method, evaluate the effects of the following relationships for the Butters Corporation.
a.Butters Corporation has a profit margin of 4.5 percent and its return on assets (investment) is 15 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 45.00 percent, what would the firm's 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 40.00 percent?(Input your answer as a percent rounded to 2 decimal places.)
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