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Last year Blease Inc had a total assets turnover of 133 and an equity multiplier of 175 Its sales were $205000 and its net income was $10600 The firm finances using only debt and common equity

Last year Blease Inc had a total assets turnover of 1.33 and an equity multiplier of 1.75. Its sales were $205,000 and its net income was $10,600. The firm finances using only debt and common equity and its total assets equal total invested capital. The CFO believes that the company could have operated more efficiently, lowered its costs, and increased its net income by $10,250 without changing its sales, assets, or capital structure. Had it cut costs and increased its net income by this amount, how much would the ROE have changed? Do not round your intermediate calculations.

 

Apr 01 2020 Read more Less More

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