Assume the firm's dividend is $3.44 this year, and that the required rate of return for the firm's industry is 10.2%. The firm's
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Answer:
Invnetory TurnOver 10
Average inventory 36.5
Explanation:
300,000 / 30,000 = 10
The company sales his inventory 10 times per year
In some cases, we are given with a beginning and ending inventory.
For those, we calculate the average inventory:
(beginning + ending)/2
365/10 = 36.5
The average the inventory age is 36.5 days
365 are the days of the year, and the inventory Turnover are the times per year the inventory is being sold.
we divide one fro manother to get a metric in days of how much the invneotry is in store before being sold.
Answer:
9.21%
Explanation:
Given: total assets = $250,000
Total capital = total assets = $250,000
Total debt to total capital ratio = 17.5%
Which means:
Total debt / Total capital = 17.5%
Find total debt:
Total debt = Total capital * 17.5%
= $250,000 * 0.175
= $43,750
Total debt = $43,750
Find total equity:
Total equity = Total capital - Total debt = $250,000 - $43,750 = $206,250
To find the Return on Equity (ROE), use the formula based on Du point:
ROE = Profit margin * Asset turnover * Equity multiplier
= (Net income / Sales ) * ( Sales / Total assets ) * ( Total assets / Total equity)
= 9.21%
ROE = 9.21%