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What is the company return on invested capital

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Question - You are given the following information for Western, Inc.

Sales 240,000

Debt 60,000

Dividends 5,000

Equity 30,000

Interest rate 7%

Net income 16,000

Tax rate 30%

Assume the company has no short-term debt. Also assume that all asset turnover, profit margin, and dividend payout ratios remain constant. (Hint: First prepare income statement working backwards from the bottom to find EBIT.)

Required - What is the company's return on invested capital (ROIC)?

A. 21.04%

B. 19.43%

C. 18.11%

D. 17.01%

E. 16.08%

F. 15.28%

G. 14.59%

H. 13.98%

Reference no: EM132756989

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