Student8990 Student8990
  • 12-11-2020
  • Business
contestada

A firm has a tax burden ratio of 0.8, a leverage ratio of 1.35, an interest burden of 0.8, and a return on sales of 12%. The firm generates $2.60 in sales per dollar of assets. What is the firm's ROE?

Respuesta :

Tundexi
Tundexi Tundexi
  • 15-11-2020

Answer:

28.64%

Explanation:

ROE = Tax burden * Interest burden * Margin * Turnover * Leverage

ROE = 0.85*0.8*0.12*2.60*1.35

ROE = 0.286416

ROE = 28.64%

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