​A Company's Profit Margin Is 15

question 82

Multiple Choice

​A company's profit margin is 15.5%, its asset turnover 0.72, and its financial leverage is 3.25.Determine the company's return on shareholders' equity.

• A) ​42.5%
• B) ​36.3%
• C) ​51.7%
• D) ​28.4%

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Definitions:

Physical Units

A method of measuring production or inventory in terms of actual physical items or quantities.

Ending Inventory

The value of goods available for sale at the end of an accounting period, calculated as the beginning inventory plus purchases minus cost of goods sold.

Ending Work in Process

Refers to the items still in production and not yet ready for sale at the end of an accounting period.

Total Units

The entire quantity produced, held in inventory, or sold by a business in a specified period.