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    Return on Equity

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    Utilizing the following information, compute the firm's return on equity.

    Balance Sheet (000)
    Current Assets 1,500 Current Liabilities 910
    Fixed Assets 7,000 Long term Liabilties 1200
    Common Stock(at par) 2000
    Paid in capital 1000
    Retained Earnings 3390

    8500 8500

    Income Statement (000s)

    Net sales 12750
    Cost of Sales 7650
    Gross Margin 5100
    Operating Expenses 3165
    Earnings before interest and taxes 1935
    Interest 235
    Earnings before tax 1700
    Taxes (40%) 680
    Earnings after tax 1020

    © BrainMass Inc. brainmass.com June 3, 2020, 9:42 pm ad1c9bdddf
    https://brainmass.com/business/beta-and-required-return-of-a-project/return-on-equity-195768

    Solution Summary

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    $2.19

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