DuPont Analysis You Are Considering Investing in Totally Tire Services

question 5

Multiple Choice

DuPont Analysis You are considering investing in Totally Tire Services.You have been able to locate the following information on the firm: total assets = $50 million,accounts receivable = $10 million,ACP = 15 days,net income = $4.5 million,and debt-to-equity ratio = 0.75 times.What is the ROE for the firm?

• A)1.58 percent
• B)9.00 percent
• C)15.75 percent
• D)28.81 percent

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Definitions:

Defined Benefit Plans

Retirement plans promising a specified monthly benefit at retirement, often based on salary and years of service.

Longevity

The length of time an individual or entity has been in existence or operational, often used in the context of work tenure or product durability.

Defined Contribution Plans

Retirement plans in which employees contribute a fixed amount or percentage of their salaries, and the final benefits depend on the plan's investment performance.

Mandatory Benefits

Benefits that employers are legally required to provide to their employees, including social security, workers' compensation, and unemployment insurance.