35、Assume U.S. GAAP (generally accepted accounting principles) applies unless otherwise noted. An analyst gathered the following information (U.S. $ millions) for two companies operating in the same industry during the same period: Butler Enterprises
Annandale Corporation Net sales $120 $300 Total assets $70 $140 Total liabilities $25 $40 If both companies achieved a return on equity of 15 percent for the period, the company most likely to have the higher net profit margin and higher financial leverage multiplier, respectively, is: Higher net profit margin Higher financial leverage multiplier A. Butler Butler B. Butler Annandale C. Annandale Butler D. Annandale Annandale A. Answer A B. Answer B C. Answer C D. Answer D
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