Question
You are given the following information for Western, Inc. Sales 240,000 Debt 60,000 Dividends 5,000 Equity 30,000 Interest rate 7% Net income 16,000 Tax rate
You are given the following information for Western, Inc.
| Sales | 240,000 |
| Debt | 60,000 |
| Dividends | 5,000 |
| Equity | 30,000 |
| Interest rate | 7% |
| Net income | 16,000 |
| Tax rate | 30% |
Assume the company has no short-term debt. Also assume that all asset turnover, profit margin, and dividend payout ratios remain constant. (Hint: First prepare income statement working backwards from the bottom to find EBIT.) What is the companys return on invested capital (ROIC)?
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Finance With Monte Carlo
Authors: Ronald W. Shonkwiler
2013th Edition
146148510X, 978-1461485100
