You are thinking of investing in Ski Sports, Inc. You have only the following information on the firm at year-end 2018: net inco
1 answer:
Answer:
Roe will be equal to 11.67 %
Explanation:
We have given net income = $50000 = $0.05 million
Total debt = $1 million
Debt ratio = 70% = 0.70
We have to find the ROE
Debt ratio is ratio o debt and assets
So
Assets = $1.42 million
Now equity will be equal to assets - debt
So equity = $1.42 - $1 = $0.42 million
Now equity ratio is equal to ratio of net income and equity
So equity ratio = 11.67 %
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Answer:
The solution of the given query is explained throughout the segment below.
Explanation:
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= $6,500,000
Rate of interest,
= 6%
Time,
= 10 years
Now,
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=
=
= ($)
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=
=
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