Question
Using the DuPont method, evaluate the effects of the following relationships for the Lollar Corporation. a. Lollar Corporation has a profit margin of 4.5 percent
Using the DuPont method, evaluate the effects of the following relationships for the Lollar Corporation.
a.Lollar Corporation has a profit margin of 4.5 percent and its ROA (investment) is 10.00 percent. What is its asset turnover?(Do not round intermediate calculations. Round the final answer to 2 decimal places.)
Asset turnover ratio:x
b.If Lollar Corporation has a debt-to-total-assets ratio of 55 percent, what would the firm's ROE be?(Do not round intermediate calculations.Roundthe finalanswer to 2 decimal places.)
Return on equity:%
c.What would be the ROE, if the debt-to-total-assets ratio decreased to 50 percent?(Do not round intermediate calculations.Roundthe finalanswer to 2 decimal places.)
Return on equity:%
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