Question
 RSP Ltd has a net profit margin of 12% and a total
asset turnover of 1.2 times and a financial leverage multiplier of 1.2 times. RSP Ltd’s return on equity is closest to:Solution
Return on equity = (net income/sales) (sales/assets) (assets/equity) [DuPont Formula] (0.12)(1.2)(1.2) = 17.28~17.3%
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