Calculate its basic earning power-its return on equity

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Reference no: EM132066972

Broward Manufacturing recently reported the following information: Net income $420,000 ROA 10% Interest expense $134,400 Accounts payable and accruals $1,000,000 Broward's tax rate is 30%. Broward finances with only debt and common equity, so it has no preferred stock. 40% of its total invested capital is debt, while 60% of its total invested capital is common equity. Calculate its basic earning power (BEP), its return on equity (ROE), and its return on invested capital (ROIC). Round your answers to two decimal places.

Reference no: EM132066972

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