Answer:
21.55 percent
Explanation:
Profit margin = Net Income / Net Sales
Net Income = Profit Margin X Net Sales
Net Income = 13.2% X 618,900 = $81,695
Asset Turnover rate = Net Sales / Average total assets
Average total assets = Net Sales / Asset Turnover rate
Average total assets = 618900 / 1.54 = 401,883
Equity Multiplier = Total assets / shareholder's equity
Shareholder's equity = Total Assets / Equity multiplier
Shareholder's equity = 401,833 /1.06 = $379,135
Return on Equity = net Income / shareholder's equity
Return on Equity = 81,695 / 379135 = 0.2155 = 21.55%
