ZX Limited has total assets of 7,20,000 and its Shareholders' equity is 4,50,000. The net profit margin of ZX Limited is 12.5% and asset turnover…

CA Intermediate · Financial Management and Strategic Management · PYQS · September 2024
ZX Limited has total assets of 7,20,000 and its Shareholders' equity is 4,50,000. The net profit margin of ZX Limited is 12.5% and asset turnover ratio is 1.5. Using the DuPont model, the return on equity of ZX Limited is calculated as :
(A) 7.03%
(B) 50%
(C) 11.72%
(D) 30%

Suggested Answer and Working Notes:

Correct Answer: Option (D)

30%

Topics: Part-A: Financial Management

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