DuPont Analysis Last Year, PJ's Ice Cream Parlors, Inc

question 28

Multiple Choice

DuPont Analysis Last year, PJ's Ice Cream Parlors, Inc. reported an ROE = 12%. The firm's debt ratio was 40%, sales were $25 million, and the capital intensity ratio was 0.75 times. What is the net income for PJ's last year?

• A) $1.35m
• B) $2.40m
• C) $3.00m
• D) $18.75m

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Definitions:

Rational Man

A concept in economics and philosophy that assumes an individual acts logically and with complete information, aiming to maximize personal benefit.

Anthropomorphic Man

A concept or depiction of a human being with attributes, behaviors, or other characteristics that are typically found in animals.

Cognitive Schema

A mental framework or structure that organizes and interprets information in the brain.

Hindsight Bias

The tendency to overestimate one’s ability to have predicted an event after the outcome is known; the “I knew it all along” phenomenon.