Pendant Publishing reported the following results for its Textbook Division: Pendant's target rate of return is 11% and the weighted average cost of capital is 6%. Its effective tax rate is 45%.
What is the Textbook Division's sales margin?
A)200.00%
B)20.00%
C)40.00%
D)28.18%

Question

Pendant Publishing reported the following results for its Textbook Division:  Pendant's target rate of return is 11% and the weighted average cost of capital is 6%. Its effective tax rate is 45%.
What is the Textbook Division's sales margin?
A)200.00% 
B)20.00% 
C)40.00% 
D)28.18%

Quizplus · Accepted Answer

The Answer of Pendant Publishing reported the following results for its Textbook Division:  Pendant's target rate of return is 11% and the weighted average cost of capital is 6%. Its effective tax rate is 45%.
What is the Textbook Division's sales margin?
A)200.00% 
B)20.00% 
C)40.00% 
D)28.18%

Pendant Publishing Reported the Following Results for Its Textbook Division