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A DuPont analysis is conducted using the DuPont equation, which helps to identify and analyze three important factors that drive a company’s ROE. According to the equation, which of the following factors directly affect a company’s ROE? Check all that apply. Total Assets / Total Common Equity Net Income / Sales Price per Share / Earnings per Share

1 Answer

7 votes

Answer:

Total Assets / Total Common Equity

Step-by-step explanation:

Depend upon theDu Pont Equation,

The following formula should be used

ROE = Net profit margin × Total asset turnover × Equity multiplier

And,

ROE = (Net profit ÷ Sales) × (Sales ÷ Total Assets) × (Assets ÷ Equity)

So as per the above formula, the above answer should be considered

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