LeCompte Corp

question 47

Multiple Choice

LeCompte Corp.has $312,900 of assets, and it uses only common equity capital (zero debt) .Its sales for the last year were $620,000, and its net income after taxes was $24,655.Stockholders recently voted in a new management team that has promised to lower costs and get the return on equity up to 15%.What profit margin would LeCompte need in order to achieve the 15% ROE, holding everything else constant?

• A) 7.57%
• B) 7.95%
• C) 8.35%
• D) 8.76%
• E) 9.20%

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Definitions:

Cuboidal Cells

Epithelial cells with a cube-like shape, often found lining glands and ducts.

Sudoriferous Glands

Glands in the skin responsible for the production and secretion of sweat.

Hypodermis

The innermost layer of the skin, composed primarily of fat and connective tissues, providing insulation and cushioning for the body.

Reticular Region

The deeper layer of the dermis in the skin, composed of dense irregular connective tissue featuring collagen and elastin fibers.