1. Suppose a business firm had an ROA of 25.0 percent, a profit margin of 14.0 percent, and sales of $6 million. What is the amount of total assets

1. Suppose a business firm had an ROA of 25.0 percent, a profit margin of 14.0 percent, and sales of $6 million. What is the amount of total assets for the firm?

A. less than $1.92 million

B. $1.92 million

C. $2.50 million

D. $3.18 million

E. $3.36 million

2. You have the following information on Cast Concrete: sales to working capital = 12.4 times, profit margin = 20 percent, net income available to common stockholders = $620,000, and current liabilities = $216,000. What is the amount of current assets for Cast Concrete? A. less than $440,000

B. $440,000

C. $466,000

D. $476,000

E. more than $480,000

3. A firm's financial statements show the following: sales = $1,285,000, operating expenses = $397,800, interest expense = $29,700, EBIT = $403,800, taxes = $114,500, equity = $342,700, current assets = $223,275, current liabilities = $186,350 and total liabilities = $587,500. What is the firm's return on assets (ROA)?

A. 23.3%

B. 27.9%

C. 29.4%

D. 36.2%

E. 43.4%

4. Rapid Roofing, Inc. reported sales of $15.4 million. It had a debt ratio of 40 percent and total debt amounted to $4 million. What was the capital intensity ratio for Rapid Roofing?

A. 0.80 times

B. 0.75 times

C. 0.65 times

D. 0.50 times

E. 0.35 times

5. Market ratios differ from other ratios because

A. they are the only ratios that relate equity measures to other variables.

B. they are based on information not contained in the firm's financial statements.

C. they are always the most important ratios to shareholders.

D. they are the only ratios that may have negative values.

E. C and D, only

6. The basic DuPont equation, which looks at a firm's ROA, analyzes the firm's profitability as a function of the

A. profit the firm earns per dollar of sales and the dollar of sales produced per dollar of assets

B. firm's operating efficiency and efficiency in asset use.

C. profit margin and total asset turnover.

D. All of the above.

E. B and C, only

7. The DuPont analysis calculates ROE as the product of

A. activity, leverage, and debt.

B. leverage, market value, and turnover.

C. profitability, liquidity, and leverage.

D. margin, profitability, and leverage.

E. margin, turnover, and leverage.