Last Year Harrington Inc

question 21

Multiple Choice

Last year Harrington Inc.had sales of $325,000 and a net income of $19,000,and its year-end assets were $250,000.The firm's total-debt-to-total-capital ratio was 17.5%.The firm finances using only debt and common equity,and its total assets equal total invested capital.Based on the DuPont equation,what was the ROE? Do not round your intermediate calculations.

• A) 11.52%
• B) 9.49%
• C) 9.21%
• D) 9.86%
• E) 7.74%

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Definitions:

Conversion Formula

A mathematical equation used to convert a quantity expressed in one set of units to another set of units.

Milligrams

A unit of mass in the metric system equal to one-thousandth of a gram.

Grams

A unit of mass in the metric system, used to measure small quantities of substances.

Dimensional-Analysis

A method in mathematics and physics that uses units of measurement to help solve problems involving conversion or comparison of different scales.