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    Stooges24's Avatar
    Stooges24 Posts: 1, Reputation: 1
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    #1

    Oct 6, 2009, 06:49 AM
    ROA-Return on Assets
    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's Avatar
    ArcSine Posts: 969, Reputation: 106
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    #2

    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.
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