1 answer

If a company's ROA is 9% and its total long term debt to total assets ratio...

Question:

if a company's ROA is 9% and its total long term debt to total assets ratio is 60% What is its ROE?(Return on Equity) Enter your answer as a decimal rounded to 4 decimal places, not a percentage For example enter 0.0843 instead of 8.43%)


Answers

Total long term debt to Total Assets = 60%

Total Debt/Total Assets = 60%

Now, Assets = Debt + Equity

Debt = Assets - Equity

(Assets - Equity)/Assets = 60%

1 - (Equity/Assets) = 60%

Equity/Assets = 40%

Assets/Equity = 2.50

ROE = Net Income/Equity

Dividend and multiplying by Assets

ROE = (Net Income/Assets) * (Assets/Equity)

ROE = 9% * 2.5

ROE = 22.5%

Hence, answer in required format = 0.2250

.

Similar Solved Questions

1 answer
A mass m = 1 kg is attached to a spring with constant k = 9...
A mass m = 1 kg is attached to a spring with constant k = 9 N/m and a dashpot with variable damping coefficient c. If the mass is to be pulled 8 m beyond its equilibrium (stretching the spring) and released with zero velocity, what value of c ensures that the mass will pass through the equilibrium p...
1 answer
How many atoms are in 5.28g of P
How many atoms are in 5.28g of P...
1 answer
Part 1 Complete the following problems using the Tic-Tac-Toe method of ABG interpretation (each worth 1...
Part 1 Complete the following problems using the Tic-Tac-Toe method of ABG interpretation (each worth 1 point) ABG Acid/Base Status List One Possible Causative Clinical Condition Ex: pH 7.29 Metabolic acidosis Renal failure pCO2 37 HCO3 19 1 pH 7.58 pCO...
1 answer
Required: a. What is the net present value of the proposed mining project? b. Should the...
Required: a. What is the net present value of the proposed mining project? b. Should the project be accepted? Windhoek Mines, Ltd., of Namibia, is contemplating the purchase of equipment to exploit a mineral deposit on land to which the company has mineral rights. An engineering and cost analysis ha...
1 answer
In a certain region of space, the charge density is given in cylindrical coordinates by the...
In a certain region of space, the charge density is given in cylindrical coordinates by the function p=20*r*e^(-r). Apply gauss's law to find D...
1 answer
D Question 27 1 pts In an article in August of 2015 it was reported in...
D Question 27 1 pts In an article in August of 2015 it was reported in Forbes that "Year-to-date Prius sales were down 15.4 percent." It was also observed that gas prices had fallen significantly. That lower gas prices can lead to lower sales of hybrid vehicles is best explained by observing...
1 answer
8. If the thickness needed by a certain medium to reduce the intensity of incident x-rays...
8. If the thickness needed by a certain medium to reduce the intensity of incident x-rays by 40% is 150 cm, what is the attenuation coefficient of the medium?...
1 answer
Bonus question (4 points): Consider the following probability density function: f(x) = le-(x-),x2. Find the maximum...
Bonus question (4 points): Consider the following probability density function: f(x) = le-(x-),x2. Find the maximum likelihood estimator of based on a random sample of size n....
1 answer
A project has an initial cost of $60,625, expected net cash inflows of $15,000 per year...
A project has an initial cost of $60,625, expected net cash inflows of $15,000 per year for 7 years, and a cost of capital of 14%. What is the project's PI? (Hint: Begin by constructing a time line.) Do not round intermediate calculations. Round your answer to two decimal places....
1 answer
Part A what is the equivalent resistance between ports a and b n the figure(Figure 1)IR=1200?...
Part A what is the equivalent resistance between ports a and b n the figure(Figure 1)IR=1200? re 1 of 1 lt Incorrect: Try Again: 3 attempts remaining R b Part A Suppose that R-1k0 and -3AP What is the time constant for the discharge of the capacitors in (Figure 1)2 Express your answer to two signifi...
1 answer
Why why did they not include the 2 EXAMPLE 2. One can use expansion (1) and...
why why did they not include the 2 EXAMPLE 2. One can use expansion (1) and the definition (Sec. 34) eiz sin z = 2i = sin z. To give the details, to find the M aclaurin series for the entire function f (z) we refer to expansion (1) and write (-iz)" (iz)" Σ sin z = 2i ΣΣ1--1...
2 answers
There are two answers posted for this question. can you confirm which one is the correct...
there are two answers posted for this question. can you confirm which one is the correct one and why? ---------------------- question: You are considering a new product launch. The project will cost $950,000 and have a four-year life with no salvage value. Assets for the project are depreciated stra...
1 answer
How can we as health care providers better support Indigenous women in their journey?
how can we as health care providers better support Indigenous women in their journey?...
1 answer
What is the configuration of the following chiral center? OH 4 H3C 2 CH3
What is the configuration of the following chiral center? OH 4 H3C 2 CH3...
1 answer
Jimmy paid off a mortgage by paying $750 per month for 14 years. What was the...
Jimmy paid off a mortgage by paying $750 per month for 14 years. What was the original amount of the mortgage if the interest rate charged was 5.50% compounded semi-annually?...