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A Company Has Annual Sales of $160 Million, a Net

Question 20

Multiple Choice

A company has annual sales of $160 million, a net profit margin of 4%, and total assets of $90 million. It carries $10 million in accounts receivable, $25 million in inventory, has $55 million in total debt, and 5 million shares of common stock outstanding. Based on this information, the company's return on equity (ROE) is


A) 4.4%.
B) 11.5%.
C) 18.3%.
D) 7.1%.

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