Sunshine Rentals has a debt-equity ratio of 0.84.Return on assets is 7.9 percent,and total equity is $438,000.What is the net income?
A)$41,147.09
B)$54,311.29
C)$63,667.68
D)$48,887.02
E)$50,458.95

Name: Sunshine Rentals has a debt-equity ratio of 0.84.Return on assets is 7.9 percent,and total equity is $438,000.What is the net income? A)$41,147.09 B)$54,311.29 C)$63,667.68 D)$48,887.02 E)$50,458.95
Brand: Quizplus
Rating: 4.8 (37 reviews)

Question

Quizplus · Accepted Answer

Return on equity = 0.079 × (1 + 0.84) = 0.14536; Net income = 0.14536 × $438,000 = $63,667.68

Sunshine Rentals Has a Debt-Equity Ratio of 0