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lina2011 [118]
3 years ago
15

Manufacturer A has a profit margin of 2.2%, an asset turnover of 1.7 and an equity multiplier of 5.0. Manufacturer B has a profi

t margin of 2.5%, an asset turnover of 1.2 and an equity multiplier of 4.7. How much asset turnover should manufacturer B have to match manufacturer A's ROE?
A) 1.59% B) 3.18% C) 2.23% D) 1.27%
Business
1 answer:
Sergeeva-Olga [200]3 years ago
7 0

Answer:

A. 1.59%

Explanation:

Return on equity is a measure of profitability of a company in relation to the equity which is assets less liabilities.

Using Du Point analysis,

ROE = Net profit margin × Asset Turnover × Equity multiplier.

Therefore,

ROE of A = 2.2 × 1.7 × 5.0

= 18.7%

For ROE of B to match A

Asset turn over of B = ROE of A / profit margin of B × equity multiplier of B.

NOTE:

This was gotten from from equating ROE of A to ROE of B and making asset turn over of B subject of the formula.

Therefore,

Given that,

ROE of A = 18.7%

Profit margin of B = 2.5%

Equity multiplier of B = 4.7

We then have,

Asset turnover of B = 18.7 ÷ ( 2.5 × 4.7)

= 18.7 ÷ 11.75

=1.59 %

Therefore B needs 1.59% asset turn over to match manufacturers A ROE

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An organization looking for general agreement on ethical practices might:<u> establish an ethical code of conduct.</u>

<h3>What is establish an ethical code of conduct?</h3>

Ethical code of conduct can be defined as a set of guidelines, policy, rules and regulation that a person is expected to follow and abide by in an organization.

This code of conduct enables us to know the organization norms and values as well  what is right and what is wrong which in turn means that it enables us to know the right things to do and thing to to avoid.

The code of conduct encourage ethical act which is to be honest and to have integrity among others and as well discourage unethical behavior in an organization which is why most organization has ethical code of conduct that enables their employee or workers to known the ethical ways they should behave.

Therefore an organization looking for general agreement on ethical practices might:<u> establish an ethical code of conduct.</u>

Learn more about establish an ethical code of conduct here:brainly.com/question/28465686

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1 year ago
A listing on eBay featured a refurbished iMac desktop computer; interested buyers all ranged in age from teenagers to adults wit
Hatshy [7]

Based on the ages of those <em>showing interest</em>, these buyers were likely from the generational cohort of:

  • Gen Y

<h3>What is an Age Group?</h3>

This refers to the group of people who are of similar age ranges which were born during a particular period and today we can say some are Millennials, Gen Z, etc.

With this in mind, we can see that based on the eBay listing, there was the listed sale for an item and because the interested buyers were from an age group which was made up of teenagers, we can state that they were the Gen Y.

Read more about age group here:
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4 0
2 years ago
Which tech company is named after a very large number
nlexa [21]

Answer:

Gogle, which was derived from a misspelling of Page's original planned name,  (a mathematical term for the number one followed by 100 zeroes).

Explanation:

6 0
2 years ago
Read 2 more answers
2. Chico Co. sold $4 million of 10-year bonds on December 31, 2015, with interest payable June 30 and December 31 at an annual r
Aleonysh [2.5K]

Answer:

The requirement of the question is provided below:

a.  What were the proceeds received by Chico upon the sale of the bonds?  

b.  Prepare the entry made by Chico to record the sale of the bonds on December 31, 2015.

The proceeds from the issue is $4,498,488.41

The entries are:

Dr Cash                     $4,498,488.41

Cr Bonds payable                              $4,000,000

Cr Premium on bonds payable           $498,488.41

Explanation:

The first task here is to determine the proceeds from the issue, which can be done using the present value formula in excel.

=pv(rate,nper,pmt,fv)

rate is the effective rate of 10% divided by 2,since coupon is paid twice a year.

nper is the time to maturity of 10 years multiplied by 2

pmt is the coupon payment paid twice a year, that is :12%/2*$4000,000=$240,000

fv is the value expected by investors upon redemption that is $4 million

=-pv(5%,20,240000,4000000)

pv=$4,498,488.41

5 0
3 years ago
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Prairie, Inc. produces a single product. It has an annual capacity of 10,000 units, but currently uses only 80% of it. Each unit
ivanzaharov [21]

Answer:

Variable cost= $42

Explanation:

Giving the following information:

Each unit is sold for $50

Direct material worth $30

Direct labor worth $5.

Manufacturing overhead cost is $10 per unit of which 70% is variable.

The incremental cost is the variable cost (there is available capacity)

Variable cost= direct material + direct labor + variable manufacturing overhead = 30 + 5 + (10*0.7)= $42

3 0
3 years ago
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