The Buffalo Manufacturing Company has total assets of $12 million, an asset turnover of 2.2 times, and
Question:
The Buffalo Manufacturing Company has total assets of $12 million, an asset turnover of 2.2 times, and a net profit margin of 14%.
a. What is Buffalo's return on assets?
b. Find Buffalo's ROE, given that 40% of the assets are financed with stockholders' equity.
Asset TurnoverAsset turnover is sales divided by total assets. Important for comparison over time and to other companies of the same industry. This is a standard business ratio.
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We will use the following three ratios Return on assets Net profit after taxesTotal assets Net profi...View the full answer
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Related Book For
Fundamentals Of Investing
ISBN: 9780134083308
13th Edition
Authors: Scott B. Smart, Lawrence J. Gitman, Michael D. Joehnk
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