The amount of net income is $50,158.93.
Given:
Debt ratio = 62%
Asset turnover = 1.24
Profit margin = 5.1%
Total equity = $489,600
Find the Total Debt:
Debt = debt ratio × total equity
Debt = 0.62 * 489,600
Debt = $303,552
Find the Total Assets:
Total assets = Total debt + Total equity
Total assets = $303,552 + $489,600
Total assets = $793,152.
Find Total Turnover:
Turnover = Total assets * Total asset turnover ratio
= $793,152. * 1.24
= $983,508.48
Now find the amount of Net Income:
Net Income = Turnover * Profit margin
Net Income = $983,508.48 * 5.1%
= $50,158.93
The amount of net income is $50,158.93.
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