Stooges24
Oct 6, 2009, 06:49 AM
Find the ROA (return on assets) when sales is $510,400, total equity is $250,000, profit margin is 8%, and debt-equity ratio is .60
ArcSine
Oct 6, 2009, 06:56 AM
Step by step...
From the given Debt / Equity ratio, and the given amount of Equity, find Debt.
Then, Debt + Equity = Total Assets
From the given Sales and Profit Margin values, find Net Profit.
Finally, ROA = Net Profit / Total Assets
That's the recipe and all the necessary ingredients.