All Related Questions of Equity Multiplier

Q: Assuming the following ratios are constant, what is the sustainable growth

Assuming the following ratios are constant, what is the sustainable growth rate? Total asset turnover 5 2.20 Profit margin 5 7.4% Equity multiplier 5 1.40 Payout ratio 5 40%

Q: If Jares, Inc., has an equity multiplier of 1.

If Jares, Inc., has an equity multiplier of 1.55, total asset turnover of 1.75, and a profit margin of 4.3 percent, what is its ROE?

Q: A firm has a profit margin of 2% and an equity

A firm has a profit margin of 2% and an equity multiplier of 2.0. Its sales are $100 million, and it has total assets of $50 million. What is its ROE?

Q: Bartley Barstools has an equity multiplier of 2.4, and

Bartley Barstools has an equity multiplier of 2.4, and its assets are financed with some combination of long-term debt and common equity. What is its debt ratio?

Q: If Silas 4-Wheeler, Inc. has an ROE of

If Silas 4-Wheeler, Inc. has an ROE of 18 percent, equity multiplier of 2, and a profit margin of 18.75 percent, what is the total asset turnover and the capital intensity?

Q: A linear probability model you have developed finds there are two factors

A linear probability model you have developed finds there are two factors influencing the past bankruptcy behavior of firms: the equity multiplier and the total asset turnover ratio. Based on past ban...

Q: A linear probability model you have developed finds there are two factors

A linear probability model you have developed finds there are two factors influencing the past bankruptcy behavior of firms: the equity multiplier and the total asset turnover ratio. Based on past ban...

Q: Needham Pharmaceuticals has a profit margin of 3% and an equity

Needham Pharmaceuticals has a profit margin of 3% and an equity multiplier of 2.0. Its sales are $100 million and it has total assets of $50 million. What is its ROE?

Q: Chris Guthrie was recently hired by S&S Air, Inc

Chris Guthrie was recently hired by S&S Air, Inc., to assist the company with its financial planning and to evaluate the company’s performance. Chris graduated from college five...

Q: Find the following financial ratios for Smolira Golf Corp. (use

Find the following financial ratios for Smolira Golf Corp. (use year-end figures rather than average values where appropriate): Short-term solvency ratios: a. Current ratio...

Q: If Roten Rooters, Inc., has an equity multiplier of 2

If Roten Rooters, Inc., has an equity multiplier of 2.80, total asset turnover of 1.15, and a profit margin of 5.5 percent, what is its ROE?

Q: Refer to the financial statement data provided below for Safety-First

Refer to the financial statement data provided below for Safety-First, Inc. SAFETY-FIRST, INC. Income Statements (in $ Thousands)     2015 2016  Net sales  3,750  4,500  Cos...

Q: The Pharma Biotech Corporation spent several years working on developing a DHA

The Pharma Biotech Corporation spent several years working on developing a DHA product that can be used to provide a “fatty acid” supplement to a whole variety of food products. DHA stands for docsah...

Q: If Wilkinson, Inc., has an equity multiplier of 1.

If Wilkinson, Inc., has an equity multiplier of 1.35, total asset turnover of 2.10, and a profit margin of 5.2 percent, what is its ROE?

Q: Dan Ervin was recently hired by East Coast Yachts to assist the

Dan Ervin was recently hired by East Coast Yachts to assist the company with its short-term financial planning and also to evaluate the company’s financial performance. Dan graduated...

Q: Assume an investor uses the constant-growth DVM to value a

Assume an investor uses the constant-growth DVM to value a stock. Listed below are various situations that could affect the computed value of a stock. Look at each one of these individually and indica...

Q: The following summary financial statistics were obtained from the 2015 Otago Bay

The following summary financial statistics were obtained from the 2015 Otago Bay Marine Motors (OBMM) annual report. 2015 ($ in millions) Sales revenue ………………………………………………………………………………… $179.3 Total as...

Q: Last year, InDebt Company paid $75 million of interest expense

Last year, InDebt Company paid $75 million of interest expense, and its average rate of interest for the year was 10%. The company’s ROE is 15%, and it pays no dividends. Estimate next year’s interest...

Q: A security analyst calculates the following ratios for two banks. How

A security analyst calculates the following ratios for two banks. How should the analyst evaluate the financial health of the two banks?

Q: A formula in financial analysis is: Return on equity =

A formula in financial analysis is: Return on equity = net profit margin × total asset turnover × equity multiplier. Suppose that the equity multiplier is fixed at 4.0, but that the net profit margin...

Q: Grossman Enterprises has an equity multiplier of 2.6 times,

Grossman Enterprises has an equity multiplier of 2.6 times, total assets of $2,312,000, an ROE of 14.8 percent, and a total asset turnover ratio of 2.8 times. Calculate the firm’s sales and ROA?

Q: If a company’s net profit margin is –5 percent, its

If a company’s net profit margin is –5 percent, its total asset turnover is 1.5 times, and its equity multiplier is 1.2 times, its return on equity is closest to a. –9.0 percent. b. –7.5 percent. c. –...

Q: Lemmon Enterprises has a total asset turnover of 2.1 and

Lemmon Enterprises has a total asset turnover of 2.1 and a net profit margin of 7.5%. If its equity multiplier is 1.90, what is the ROE for Lemmon Enterprises?

Q: The equity multiplier for Spiffy Corporation is 1.75, its

The equity multiplier for Spiffy Corporation is 1.75, its EBIT return on assets (EROA) is 0.07, and the value of its equity is $850,000. What is the value of Spiffy’s total assets? What is the value o...

Q: For the following firms, find the return on equity using the

For the following firms, find the return on equity using the three components of the DuPont identity: operating efficiency, as measured by the profit margin (net income/sales); asset management effici...

Q: Go to a Web site such as Yahoo.com and find

Go to a Web site such as Yahoo.com and find the sales, net income, total assets, and total equity of the following five actively traded companies: Microsoft (MSFT), Boeing (BA),Wal-Mart (WMT), Procter...

Q: If Roten Rooters, Inc., has an equity multiplier of 1.27,

If Roten Rooters, Inc., has an equity multiplier of 1.27, total asset turnover of 2.10, and a profit margin of 6.1 percent, what is its ROE?

Q: If Roten Rooters, Inc., has an equity multiplier of 1.27,

If Roten Rooters, Inc., has an equity multiplier of 1.27, total asset turnover of 2.10, and a profit margin of 6.1 percent, what is its ROE?

Q: Williams Oil Company had a return on stockholders’ equity of 18 percent

Williams Oil Company had a return on stockholders’ equity of 18 percent during 2016. Its total asset turnover was 1.0 times, and its equity multiplier was 2.0 times. Calculate the company’s net profit...

Q: Using the following data for Jackson Products Company, answer Parts a

Using the following data for Jackson Products Company, answer Parts a through g: Income Statement for the Year Ended December 31, 2016 Net sales (all on credit) …â€&br...

Q: Given the following data for Profiteers, Inc., and the corresponding

Given the following data for Profiteers, Inc., and the corresponding industry averages, perform a trend analysis of the return on investment and the return on stockholders’ equity. P...

Q: Triangular Chemicals has total assets of $100 million, a return

Triangular Chemicals has total assets of $100 million, a return on equity of 40 percent, a net profit margin of 5 percent, and an equity multiplier of 2.5. How much are the firm’s sales?

Q: Bryley, Inc., had a net profit margin of 5 percent

Bryley, Inc., had a net profit margin of 5 percent last year and an equity multiplier of 3.0. If its total assets are $100 million and its sales are $150 million, what is the firm’s return on equity?...

Q: For fiscal year 2015, Costco Wholesale Corporation (COST) had

For fiscal year 2015, Costco Wholesale Corporation (COST) had a net profit margin of 2.05%, asset turnover of 3.48, and a book equity multiplier of 3.15. a. Use this data to compute Costco’s ROE using...

Q: For fiscal year 2015, Wal-Mart Stores, Inc.

For fiscal year 2015, Wal-Mart Stores, Inc. (WMT) had total revenues of $485.65 billion, net income of $16.36 billion, total assets of $203.49 billion, and total shareholder’s equity of $81.39 billion...

Q: The Protek Company is a large manufacturer and distributor of electronic components

The Protek Company is a large manufacturer and distributor of electronic components. Because of some successful new products marketed to manufacturers of personal computers, the firm has recently und...

Q: If Rogers, Inc., has an equity multiplier of 1.

If Rogers, Inc., has an equity multiplier of 1.43, total asset turnover of 1.87, and a profit margin of 6.05 percent, what is its ROE?

Q: Refer to the financial statement data provided below for Safety-First

Refer to the financial statement data provided below for Safety-First, Inc. A. Calculate the net profit margin, the sales-to-total-assets ratio, and the equity multiplier for both 2018 and 2019 using...

Q: The Pharma Biotech Corporation spent several years working on developing a DHA

The Pharma Biotech Corporation spent several years working on developing a DHA product that can be used to provide a fatty-acid supplement to a variety of food products. DHA stands for docosahexaenoic...

Q: A formula in financial analysis is the following: Return on equity

A formula in financial analysis is the following: Return on equity = net profit margin * total asset turnover * equity multiplier. Suppose that the equity multiplier is fixed at 3.5, but that the net...

Q: Assume an investor uses the constant-growth DVM to value a

Assume an investor uses the constant-growth DVM to value a stock. Listed are various situations that could affect the computed value of a stock. Look at each one of these individually and indicate whe...