The firm's net income is $114,045,330.
Given,
New steel products has total assets - $820,470
Total asset turnover rate - 1.39
Debt-equity ratio - 2.8
Return on equity of 0.34 percent.
Net income - ?
So, in order to find net income, we shall use the given formula,
Total Asset Turnover = Sales / Assets
1.39 = Sales / $820,470
Sales = $820,470 × 1.39
= $1,140,453.3
Thus,
Equity multiplier
= Assets / Equity
= (debt + equity) / equity
= (2.8 + 1) / 1
= 3.8
As per Dupont Analysis,
ROE = Profit margin x Asset Turnover x Equity Multiplier
0.34% = Profit Margin x 1.39 x 3.8
Thus, profit margin = 5.282%
Profit margin = Net Income / Sales x 100
5.282% = Net Income / $1,140,453.3 x 100
Hence, Net income is $114,045,330.
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