Use the following financial information to answer this question. What are the values of the three components of the DuPont identity? Use ending balance sheet values.
A)0.15; 1.02; 0.35
B)0.15; 2.02; 0.35
C)0.15; 0.98; 2.86
D)0.16; 0.98; 0.35
E)0.16; 1.02; 2.86

Question

Use the following financial information to answer this question.   What are the values of the three components of the DuPont identity? Use ending balance sheet values.
A)0.15; 1.02; 0.35 
B)0.15; 2.02; 0.35 
C)0.15; 0.98; 2.86 
D)0.16; 0.98; 0.35 
E)0.16; 1.02; 2.86

Quizplus · Accepted Answer

Profit margin = $1,220/$8,200 = 0.15; Total asset turnover = $8,200/$8,340 = 0.98; Equity multiplier = $8,340/($1,500 + $1,420) = 2.86

Use the Following Financial Information to Answer This Question