1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
geniusboy [140]
3 years ago
11

Using the Du Pont method, evaluate the effects of the following relationships for the Butters Corporation. a. Butters Corporatio

n has a profit margin of 8 percent and its return on assets (investment) is 17.75 percent. What is its assets turnover? (Round your answer to 2 decimal places.) b. If the Butters Corporation has a debt-to-total-assets ratio of 30.00 percent, what would the firm’s return on equity be? (Input your answer as a percent rounded to 2 decimal places.) c. What would happen to return on equity if the debt-to-total-assets ratio decreased to 25.00 percent? (Input your answer as a percent rounded to 2 decimal places.)
Business
1 answer:
liq [111]3 years ago
6 0

Answer:

Part a = 2.22 %

Part b = 25.36%

Part c = 23.67%

Explanation:

The Du Pont method is that method which defines the return on equity into three parts that includes gross profit margin, asset turnover, and financial leverage.

The profit margin and asset turnover show the relation with sales revenue whereas the financial leverage show a ratio of debt and shareholder equity.

a. Asset turnover : In duo Pont method,the asset turnover formula :

= Return on Assets ÷ Profit margin

= 17.75% ÷ 8%

= 2.22 %

b. The Return on equity is equal to

= Return on assets ÷ (1 - debt to total assets ratio)

= 17.75% ÷ (1-0.30)

= 25.36%

c. Applying same formula which is used in part b

Return on equity = Return on assets ÷ (1 - debt to total assets ratio)

= 17.75% ÷ (1 - 0.25)

= 17.75% ÷ 0.75

= 23.67%

Hence,  Part a = 2.22 %

Part b = 25.36%

Part c = 23.67%

You might be interested in
Purchases in May were $65,000​, while expected purchases for June and July are $75,000 and $93,000​, respectively. All purchases
guapka [62]

Answer:

$61,000

Explanation:

The computation of June payments for purchases budgeted is shown below:-

June payments for purchases budgeted = Purchase of June × Purchase percentage + May purchase × Percentage of the following month

= $75,000 × 25% + $65,000 × 65%

= $18,750 + $42,250

= $61,000

Therefore for computing the June payments for purchases budgeted we simply applied the above formula.

3 0
3 years ago
The success of the Tom Dennis Ford dealership has been built largely on return customers and word-of-mouth recommendations. The
givi [52]

Answer: Build long-term relationships with the customers

Explanation:

  According to the given scenario, the high pressure selling process is one of the ineffective approach as the dealership wants to build a long term relationship with the consumers or user.

 The long term relationship with the customers is basically creating the growth, loyalty and also the revenue of an organization as it helps in increase the productivity of the management by maintaining the good relationship with the customers.

  The following ways helps in building the long term relationship with the customers are as follows:

  • By good communication skills
  • Enhance the consumer loyalty
  • Make connection with the customer
  • Always take feedback
  • Explain about your product's benefits

 

4 0
3 years ago
your food-services company has been named as the sole provider of meals at a small university. the cost and demand schedules are
DiKsa [7]

Answer:

The answer is "400 meals at 2.50 dollars a day".

Explanation:

Please find the complete question and the solution in the attachment file.

In this question, when we compare the MR value as well as the MC, the monopolist produces up to the point where MR>MC.

In this, it happens before 400 meals at 2.50 per day and, so "400 meal at 2.50 dollars a day".

8 0
3 years ago
Select the example that is inconsistent with the provisions of the UCC for contract remedies for a seller's breach of contract.
den301095 [7]

The example that is inconsistent with the provisions of the UCC for contract remedies for a seller's breach of contract is:

b.) A toy company sells a defective rocket launcher that injures a young boy. The sales contract excludes responsibility for all consequential damages related to the sale of its products, so the company only agrees to refund the cost of the defective toy.

<h3>What is UCC for contract remedies for a seller's breach of contract?</h3>

Consumers have up to six years to raise concerns relating to breach of contract, even though the goods under the contract may not last up to this period.  Therefore, the provision by the appliance manufacturer that buyers have a maximum of six months to raise concerns is inconsistent with the Uniform Commercial Code (UCC).  The code sets the same comprehensive laws for all commercial activities in the US.

Thus, option "C" is correct.

To learn more about UCC  click here:

brainly.com/question/13640672

#SPJ1

8 0
2 years ago
"fixed costs that do not differ between two alternatives are"
muminat
Fixed costs are costs of the company that do not depend  of the business activities of the company. This means that they <span> do not change with an increase or decrease in the amount of goods or services produced or sold.</span>
<span>Fixed costs that do not differ between two alternatives are </span>irrelevant to the decision.
4 0
3 years ago
Other questions:
  • Jack, Jamie, Ronnie, and Stephan own the only computer software manufacturing companies in the country. When Jack increases the
    11·2 answers
  • What is a check provided to you by a credit card issuer that you can use to access your credit card line of credit called?
    9·1 answer
  • If an insurance company issues a disability income policy that it cannot cancel or for which it cannot increase premiums, the ty
    5·1 answer
  • Using the information below for Singing Dolls, Inc., determine cost of goods manufactured for the year: Work in Process, January
    8·1 answer
  • Which of the following situations would not result in auditors adding an additional paragraph to their report without modifying
    14·1 answer
  • Jacob inherited his grandfather's farm when he was 16. He sold the farm to Buyer, who in turn sold it to a good faith purchaser
    8·1 answer
  • One pound of material is required for each finished unit. The inventory of materials at the end of each month should equal 25% o
    6·1 answer
  • Zhang Industries sells a product for $700 per unit. Unit sales for May were 700 and each month's unit sales are expected to grow
    9·1 answer
  • The European Union (EU) bans the importation of hormone-fed U.S. beef and bioengineered corn and soybeans on safety grounds alth
    8·1 answer
  • Which statement describes a main advantage of using cash over other forms of payment
    6·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!