Young, Inc.

$2018$ Statement of comprehensive income

$($$ in millions$)$

Net sales

$$1,384$

Less: Cost of goods sold

$605$

Less: Depreciation

$180$

Earnings before interest and taxes

$599$

Less: Interest paid

$80$

Taxable income

$519$

Less: Taxes

$156$

Net income

$$363$

Addition to retained earnings

$$254$

Dividends paid

$109$

Young, Inc.

$2017$ and $2018$ Statement of financial position

$($$ in millions$)$

$2017$

$2018$

$2017$

$2018$

Cash

$$100$

$$121$

Accounts payable

$$400$

$$350$

Accounts rec.

$350$

$425$

Notes payable

$390$

$370$

Inventory

$440$

$410$

Total

$$790$

$$720$

Total

$$890$

$$956$

Long$-$term debt

$500$

$550$

Net fixed assets

$1,556$

$1,704$

Common stock

$600$

$580$

Retained earnings

$556$

$810$

Total assets

$$2,446$

$$2,660$

Total liabilities

$$2,446$

$$2,660$

Using the Du Pont Identity Method, calculate the equity multiplier given the following information. Profit margin $19\%$; total asset turnover $1\mathrm{.}5$; return on equity $37\mathrm{.}05\%.$

Question $2$ options:

$1\mathrm{.}5$

$1\mathrm{.}4$

$1\mathrm{.}3$

$1\mathrm{.}2$