Calculate basic earning power

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Broward Manufacturing recentlyr reported the following information:

Net income        $334,000

RDA                        8%

Interest expense $130,560

Accounts payable and accruals $1,000,000 Broward's tax rate is 25%.

Broward ?nances with only debt and common equity, so it has no preferred stock. 40% of its total invested capital is debt, and 60% of its total invested capital is common equity.

Question 1: Calculate its basic earning power (BEP), its return on equity (ROE). and its return on invested capital (ROIC). Do not round intermediate calculations. Round your answers to two decimal place

Reference no: EM132475218

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