31)Under the DuPont system, the return on assets is equal to a. the product of the gross profit margin and inventory turnover b. the sum of the debt-equity ratio and the return on sales c. the product of the return on sales and total asset turnover d. the product of the return on sales, total asset turnover, and equity multiplier e. none of these

The DuPont analysis is a calculation that uses the net profit margin and the asset turnover to…

Answered: 31)Under the DuPont system, the return…

Cornerstones of Financial Accounting

4th Edition

ISBN:9781337690881

Author:Jay Rich, Jeff Jones

Publisher:Jay Rich, Jeff Jones

Chapter12: Fainancial Statement Analysis

Section: Chapter Questions

Problem 27MCQ

See similar textbooks

Similar questions

Define each of the following terms: Liquidity ratios: current ratio; quick, or acid test, ratio Asset management ratios: inventory turnover ratio; days sales outstanding (DSO); fixed assets turnover ratio; total assets turnover ratio Financial leverage ratios: debt ratio; times-interest-earned (TIE) ratio; EBITDA coverage ratio Profitability ratios: profit margin on sales; basic earning power (BEP) ratio; return on total assets (ROA); return on common equity (ROE) Market value ratios: price/earnings (P/E) ratio; price/cash flow ratio; market/book (M/B) ratio; book value per share Trend analysis; comparative ratio analysis; benchmarking DuPont equation; window dressing; seasonal effects on ratios
Which of the following ratios is used to measure a firms profitability? a. Liabilities Ă· Equity c. Sales Ă· Assets b. Assets Ă· Equity d. Net Income Ă· Net Sales
Which of the following is a measurement of earnings that represents the profit before interest, taxes, depreciation and amortization are subtracted? A. net income B. retained earnings C. EBITDA D. EPS
Which of the following is not an element of the financial statements? A. future potential sales price of inventory B. assets C. liabilities D. equity
Which of the following statements is CORRECT? A. Net working capital is defined as current assets minus the difference between current liabilities and notes payable, and any increase in the current ratio automatically indicates that net working capital has increased B. If a company follows a policy of "matching maturities," this means that it matches its use of common stock with its use of long-term debt as opposed to short-term debt. C. Net working capital is defined as current assets minus the difference between current liabilities and notes payable, and any decrease in the current ratio automatically indicates that net working capital has decreased. D. Credit policy has an impact on working capital because it influences both sales and the time before receivables are collected.
Which of the following ratios best measures the profitability of a company? a) Return on equity b) Gross margin c) Current ratio d) Net operating asset turnover
Which of the following ratios measures financial leverage? a. The return on assets ratio. b. The inventory turnover ratio. c. The times interest earned ratio. d. The debt to equity ratio.
In a DuPont analysis, what are the components of return on assets?a. Net Profit Margin Ratio and Debt Ratiob. Net Profit Margin Ratio and Leverage Ratioc. Net Profit Margin Ratio and Asset Turnover Ratiod. Asset Turnover Ratio and Leverage Ratio
11, Dudley Bank has the following balance sheet and income statement. For Dudley Bank, calculate: Return on equity Return on assets Asset utilization Equity multiplier Profit margin Interest expense ratio Provision for loan loss ratio Noninterest expense ratio Tax ratio Overhead efficiency
Which ratio is calculated to ascertain the efficiency of inventory management in terms of capital investment? [A] stock velocity ratio [B] debtors velocity ratio [C] creditors velocity ratio [D] working capital turnover ratio
Which of the following shows the percentage of profit remaining after deducting cost of sales?( On ur own pls) Horizontal Analysis Debt-to-Equity Ratio Gross Profit Margin Net Profit Margin
The company’s profitability on each dollar invested in assets is represented by which of the following ratios: a. Profit margin. b. Asset turnover. c. Return on assets. d. Return on equity.

SEE MORE QUESTIONS

Recommended textbooks for you

Cornerstones of Financial Accounting

Accounting

ISBN:

9781337690881

Author:

Jay Rich, Jeff Jones

Publisher:

Cengage Learning

Survey of Accounting (Accounting I)

Accounting

ISBN:

9781305961883

Author:

Carl Warren

Publisher:

Cengage Learning

Principles of Accounting Volume 1

Accounting

ISBN:

9781947172685

Author:

OpenStax

Publisher:

OpenStax College

Cornerstones of Financial Accounting

Accounting

ISBN:

9781337690881

Author:

Jay Rich, Jeff Jones

Publisher:

Cengage Learning

Survey of Accounting (Accounting I)

Accounting

ISBN:

9781305961883

Author:

Carl Warren

Publisher:

Cengage Learning

Principles of Accounting Volume 1

Accounting

ISBN:

9781947172685

Author:

OpenStax

Publisher:

OpenStax College

Intermediate Financial Management (MindTap Course…

Finance

ISBN:

9781337395083

Author:

Eugene F. Brigham, Phillip R. Daves

Publisher:

Cengage Learning

SEE MORE TEXTBOOKS

		a. the product of the gross profit margin and inventory turnover
		b. the sum of the debt-equity ratio and the return on sales
		c. the product of the return on sales and total asset turnover
		d. the product of the return on sales, total asset turnover, and equity multiplier
		e. none of these