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Question
Last year Urbana Corp. had $197,500 of assets, $307,500 of sales, $19,575 of net income, and a debt-to-total-assets ratio of 37.5%. The new CFO believes a new computer program will enable it to reduce costs and thus raise net income to $33,000. Assets, sales, and the debt ratio would not be affected. By how much would the cost reduction improve the ROE?a. 9.32%
b. 9.82%
c. 10.33%
d. 10.88%
e. 11.42%
Answer
This answer is hidden. It contains 1 characters.
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