If you owned a business that had a net worth [shareholder's equity] of $600 million dollars and it made $36 million in profit What is the earning on the equity? What is the formula? Can it be written in percentage? What is the formula for IRR? CAN YOU GIVE AN EXAMPLE?
You know that when expanding and investing in projects overseas as Acme plans to, it is essential to understand such things as return on equity (ROE) and internal rate of return (IRR). Using Internet sources (you may want to start with the websites listed below) gather information on ROE and IRR. Explain each of these term
1. Keller Cosmetics maintains a profit margin of 4 percent and a sales-to-assets ratio of 3. a. What is its return on assets? b. If its debt-equity ratio is 1.0, its interest payments and taxes are each $10,000, and EBIT is $40,000, what is the return on equity? 2. Sara Togas sells all its output to Federal Stores. The
My company has a new management team that has developed an operating plan to improve upon last year's ROE. The new plan would place the debt ratio at 55 percent which will result in interest charges of $7,000 per year. EBIT is projected to be $25,000 on sales of $270,000, and it expects to have a total assets turnover ratio of
See attached file. Could you please use the attached Income Statement and the Balance Sheet for fiscal years 2003 and 2002 to do a Du Pont analysis. Use income before the effect of changes in accounting principles for goodwill in your calculations. What factors caused the differences in ROE between 2003 and 2002. Wh
33. A business sells all its merchandise on credit. It has a profit margin of 4%, days sales outstanding equal to 60 days, recivables of $150K, total assets of $3million, and debt ration of 0.64. What is the firm's return on equity (ROE). 7.1 33.3 3.3 71.0 8.1
16. Identify the decision rule for accepting or rejecting investment projects using NPV. 17. Give an example of mutually exclusive investment projects and explain how they affect the capital budgeting decision. See attached file for full problem description.
2 SEPARATE SCENARIOS: Keller Cosmetics maintains a profit margin of 4 percent and a sales-to-assets ratio of 3. What would its return on assets be (ROA) and how would you arrive at this answer? If its debt-equity ratio is 1.0, its interest payments and taxes are each $10,000, and EBIT is $40,000, what is the return on eq
I am having a problem answering the following two questions.. can any one please help me??? (Complete problem found in attachment) Morgan Inc (MI) bonds pay $110 annually, have 6 years until they mature and have a YTM of 9%. Book value of the bonds is $6.5 million. D/E ratio is 1.6. What is the market value of the equity
Could provide some assistance with the following question: Last year Barden Homes and Fowler Construction earned $1 million in net income. Both companies have assets of $10 million. Barden generated a return on equity of 11.1%, whereas Fowler produced a return on equity of 20.0%. What can explain the differences in return on
Devon Inc. has a higher ROE than Berwyn Inc. (17 percent compared to 14 percent), but it has a lower EVA than Berwyn. Which of the following factors could explain the relative performance of these two companies? a. Devon is much larger than Berwyn. b. Devon is riskier, has a higher WACC, and a higher cost of equity. c. Dev
A firm with sales of $1,000,000, net profits after taxes of $30,000, total assets of $1,500,000, and total liablilities of $750,000 has a return on equity of ________. 20 percent, 15 percent, 3 percent, or 4 percent please advise answer & why - thanks!
ROE Distributions (i.e. Calculating Expected Value and Standard Deviation) Here are the estimated ROE distributions for firms A, B, and C (see attachment) a. Calculate the expected value and standard deviation for Firm C'c ROE> ROE(A) = 10.0%, o(A) = 5.5%; ROE(B) = 12.0%, o(B) = 7.7% b. Discuss the relative riskiness of
Components of Return on Equity
Calculating Return on Equity