Duffert Industries Has Total Assets of $1,050,000 and Total Current

question 51

Multiple Choice

Duffert Industries has total assets of $1,050,000 and total current liabilities (consisting only of accounts payable and accruals) of $150,000.Duffert finances using only long-term debt and common equity.The interest rate on its debt is 9% and its tax rate is 40%.The firm's basic earning power ratio is 15% and its debt-to capital rate is 40%.What are Duffert's ROE and ROIC? Do not round your intermediate calculations.

• A) 9.04%;8.93%
• B) 11.26%;9.14%
• C) 12.65%;10.19%
• D) 13.90%;10.50%
• E) 16.12%;11.66%

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Definitions:

Tobacco Industry

The sector of the economy involved in the production, marketing, and sale of tobacco and tobacco-related products.

Indentured Servitude

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King James

Refers to King James VI of Scotland and I of England and Ireland, known for the authorization of the King James Version of the Bible in 1611.

Puritans

A group of English Protestants in the 16th and 17th centuries who sought to purify the Church of England from Roman Catholic practices.