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Managerial accounting homework help

Need help with calculating profitability ratios: if company has sales of 24 million, total assets of 18million and total debt of 7million, if profit margin is 8%, then what is net income, ROA and ROE? I know answers are 1.92 million; 10.67% and 17.45% but I do not know how to get these answers... Thanks!

Profit margin = $\frac{\text{Net income}}{\text{Sales}}$ . Since you're given two of those three pieces of the puzzle, you can easily solve for the third (Net income).

With that in hand, then...

ROA = $\frac{\text{Net income}}{\text{Assets}}$ ; and...

ROE = $\frac{\text{Net income}}{\text{Equity}} \ = \ \frac{\text{Net income}}{\text{Assets - Debt}}$

I think you can run with the ball from here.

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