Total assets turnover and equity multiplier

Assignment Help Financial Management
Reference no: EM131502751

Last year Blease Inc had a total assets turnover of 1.33 and an equity multiplier of 1.75. Its sales were $205,000 and its net income was $10,600. The firm finances using only debt and common equity and its total assets equal total invested capital. The CFO believes that the company could have operated more efficiently, lowered its costs, and increased its net income by $10,250 without changing its sales, assets, or capital structure. Had it cut costs and increased its net income by this amount, how much would the ROE have changed? Do not round your intermediate calculations.

Reference no: EM131502751

Questions Cloud

What is the present value of these cash flows : What is the present value of these cash flows if the appropriate discount rate is 8 percent?
How risk and return for portfolios are different : Explain how Risk and return for portfolios are different and also important for a business?
What is effective annual interest rate : what is the effective annual interest rate (EAR)?
Three aternative for establishing a fund : calculate the amount arising from the following three aternative for establishing a fund to be available for daughters estimated college expenese
Total assets turnover and equity multiplier : Last year Blease Inc had a total assets turnover of 1.33 and an equity multiplier of 1.75. I
What is the short future position initially : A silver producer will have 500,000 ounce of production this year. What’s the short future position initially?
What is their break-even level of operating income : what is their break-even level of operating income (i.e., the level of EBIT where EPS Is the same for both firms)?
Long history of paying dividends to its shareholders : Mega Conglomerates is a successful company that has a long history of paying dividends to its shareholders twice a year
What is the npv of replacing the old machine with new one : What is the NPV of replacing the old machine with the new one?

Reviews

Write a Review

Financial Management Questions & Answers

  Explain the different transactions in inventory

Explain the different Transactions in Inventory – Sub Inventory Transfers, Inter Org transfers, Miscellaneous Transactions and Move Orders. Explain the different Inventory Controls – Locator, Lot, Serial and Revision. Explain Receiving Functionality ..

  Calculate the percent change in gross margin

Consider the following situation. Tricon Piping Systems manufactures small diameter potable polyethylene water pipe and achieves distribution primarily through plumbing wholesalers. The firm also sells directly to large construction companies, often ..

  What is the present worth of the alternative

Calculate Present Worth from Project Summary with Uniform Gradient Series. What is the Present Worth of the Alternative?

  What must monthly payments be over the 10 year period

If the interest rate is 7 percent, what must monthly payments be over the 10-year period?- If the borrower chooses to repay the loan after 5 years instead of at the end of year 10, what must the loan balance be?

  Mr cox is a passionate stamp collector

Mr. Cox is a passionate stamp collector. His collection is so valuable that he keeps it in a safety deposit box in a local bank, which charges him $25 a month. Can he deduct this expense?

  A note to the statement indicated that the plan net position

A note to the statement indicated that the plan net position was 75% of the North Orange (employer) total pension liablitiy.

  What do you expect the price of the bond to be in two years

what do you expect the price of the bond to be in two years?

  Tax bracket is trying to decide which of the two bonds

An investor in the 28 percent tax bracket is trying to decide which of the two bonds to purchase. One is corporate bond carrying an 8 percent coupon and selling at par. The other is a municipal bond with a 5 ½ percent coupon and it, too, sells at par..

  Components of traditional balance sheet

The following items are components of a traditional balance sheet. How much are the total assets of the firm

  What ACH and EFT are and how they are being used today

With the increasing use of ACH and EFT (and Bank Wires), has the game changed for how companies can manage their cash. Who can tell me what ACH and EFT are and how they are being used today.

  Savings account earnings

You are going to save money for your daughter’s education. You decide to place $4,252 every half year into savings account earnings 5.10 percent per year, compounded semi annually for the next 12 years. How much money will be in the account at the en..

  What was the capital gain of the tips in percentage

Consider a 2.45 percent TIPS with an issue CPI reference of 187.6. At the beginning of this year, the reference CPI was 196.7 and was at 204.2 at the end of the year. What was the capital gain of the TIPS in dollars? Capital gain $ What was the capit..

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd