Explore BrainMass
Share

Explore BrainMass

    Debt Ratio and Du Pont analysis

    This content was COPIED from BrainMass.com - View the original, and get the already-completed solution here!

    I need help with the following questions

    2- Debt ratio Bartley Barstools has an equity multiplier of 2.4, and its assets are financed with some combination of long- term debt and common equity. What is its debt ratio?

    3-Du Pont analysis Doublewide Dealers has an ROA of 10 percent, a 2 percent profit margin, and an ROE of 15 percent. What is its total assets turnover? What is its equity multiplier?

    5-Price/earnings ratio A company has an EPS of $ 2.00, a cash flow per share of $ 3.00, and a price/ cash flow ratio of 8.0 . What is its P/ E ratio?

    6-Du Pont and ROE A firm has a profit margin of 2 percent and an equity multiplier of 2.0. Its sales are $ 100 million and it has total assets of $ 50 million. What is its ROE?

    © BrainMass Inc. brainmass.com October 9, 2019, 9:52 pm ad1c9bdddf
    https://brainmass.com/business/finance/debt-ratio-and-du-pont-analysis-200446

    Solution Preview

    2- Debt ratio Bartley Barstools has an equity multiplier of 2.4, and its assets are financed with some combination of long- term debt and common equity. What is its debt ratio?

    Equity Multiplier = Total Assets/Shareholders' Equity

    Assets = Debt + Equity

    Equity Multiplier = (Debt + Equity)/Equity
    2.4Equity = Debt + Equity
    Debt = 1.4Equity

    Debt ratio = Total Debt/Total Assets
    = ...

    Solution Summary

    This solution is comprised of a detailed explanation to compute the debt ratio, equity multiplier, P/E ratio, and ROE.

    $2.19