The three summary ratios basic to the DuPont system of analysis are
A) net profit margin, total asset turnover, and return on investment.
B) net profit margin, total asset turnover, and return on equity.
C) net profit margin, total asset turnover, and equity multiplier.
D) net profit margin, financial leverage multiplier, and return on equity.

Question

Quizplus · Accepted Answer

The DuPont system of analysis breaks down return on equity (ROE) into three components: net profit margin, total asset turnover, and equity multiplier.

The Three Summary Ratios Basic to the DuPont System of Analysis