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Profit margin and debt ratio

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Assume the following relationships for Bauer Corp.:
Sales total assets 1.5x
Return on assets (ROA) 3%
Return on equity (ROE) 5%

Calculate Bauer's profit margin and debt ratio.

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Solution Preview

Return on Assets = Profit Margin X Asset Turnover
ROA = 3%
Asset Turnover = ...

Solution Summary

The solution explains how to calculate the profit margin and debt ratio.