Retail apliances has a return on assets(investment) ratio of 22 percentpercent.
ID: 2626037 • Letter: R
Question
Retail apliances has a return on assets(investment) ratio of 22 percentpercent.
If the debt to total assets ratio is 50 percent, what is the return on equity?
If the firm had no debt what would the return on equity ratio be?
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On december 31, last year Charlie Corporation had in inventory 410 units of its product, which cost $18 per unit to produce. During January, the compnay produced 810 units at a cost of $21 per unit.
Assuming the Charlie Corporation sold 720 units in January, what was the cost of goods sold?(Assume FIFO inventory accounting)
Explanation / Answer
Retail apliances has a return on assets(investment) ratio of 22 percentpercent.
If the debt to total assets ratio is 50 percent, what is the return on equity?
Return on Asset = Net income / Total Asset
Debt to total asset = 50%
Equity to Total Asset = 50%
Return On Equity = Return on Asset / Equity to Total Asset
Return On Equity = 22/50%
Return On Equity = 44%
If the firm had no debt what would the return on equity ratio be?
Return on Asset = Net income / Total Asset
Debt to total asset = 0%
Equity to Total Asset = 100%
Return On Equity = Return on Asset / Equity to Total Asset
Return On Equity = 22/100%
Return On Equity = 22%
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On december 31, last year Charlie Corporation had in inventory 410 units of its product, which cost $18 per unit to produce. During January, the compnay produced 810 units at a cost of $21 per unit.
Assuming the Charlie Corporation sold 720 units in January, what was the cost of goods sold?
Answer:
cost of goods sold = 410*18 + (720-410)*21
cost of goods sold = $ 13890
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