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Question:
The following data is from Saratoga Farms Inc. 2004 financial statements.
Sales
Net Income
=
Total Assets
Debt to Total Asset Ration =
$
=
= $ 2,000,000
200,000
$ 1,000,000
60 Required
a Construct and solve the Dupont equation for Saratoga Farms.
b What will be the impact on ROE if Debt to Total Assets Ratio
were 20%.