Reference no: EM132935564

As at 31 December 2013, C. Rodir nv closed the financial year with the following balance sheet (after distribution and reservation of the profit, payment of tax and interest).

                               Balans sheet Rodir (x € 1.000.000)
Buildings & Lands 85                    Shares assets 180
Machines 60                              Shares in portfolio 100 -
Stocks 40                                 Issued equity 80
Debtors 10                                    Preferred equity 5
Cash/Giro 5                                     Reserves 50
                                                  9% Bond Loan 30
                                               10% Mortgage 20
                                                  Short- term debt 15
Total 200                                          200

The 9% bond loan was equal to 40 million euros on 1 January. The repayment took place on 1 April. The mortgage loan, which was 25 million euros on 1 January 2013, was increased by 10 million euros on 1 February in connection with an investment. In addition, a repayment was made on 1 August. The other balance sheet data mentioned above are representative of the average for the year 2013. 7% interest is owed on the short-term debts. According to the profit and loss account for 2013, the turnover amounted to EUR 250,000,000. Operating expenses (excluding interest) were 90% of revenue. The corporate tax rate is 45%.

Problem 1. Calculate the interest costs for 2013.

Problem 2. Calculate the net profit (before tax) for 2013.

Problem 3. Calculate the return on equity.

Problem 4. Calculate the average interest on equity in percent (accurate to two decimal places)