The Tax Burden of the Firm Is

question 64

Multiple Choice

The tax burden of the firm is .4,the interest burden is 0.65,the return on sales is 0.05,the asset turnover is 0.90,and the leverage ratio is 1.35.What is the ROE of the firm?

• A) 1.58%
• B) 5.68%
• C) 12.20%
• D) 13.33%

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Definitions:

Income Statement

A financial document that provides a summary of a company's revenues, expenses, and profits over a specified period, typically a quarter or year.

Gross Margin

The difference between revenue and the cost of goods sold, indicating the profitability of selling goods.

Direct Expenses

Costs that can be directly attributed to the production of goods or services, such as raw materials and direct labor.

Direct Expense

Costs directly attributable to the production of goods or services, such as materials and labor.