A) Last year Rennie Industries had sales of $305,000, assets of $175,000, a profit margin of 5.3%, and an equity multiplier of 1.2. The CFO believes that the company could reduce its assets by $51,000. If so, how much would the ROE have changed? (Hint: Use the DuPont equation to find ROE before and after the proposed change, then take the difference.)

a. 4.10%

b. 4.56%

c. 5.01%

d. 5.52%

e. 6.07%

B) Brookman Inc.'s latest book value per share was $22.75, and it had 315,000 shares outstanding. If its assets are $12,796,875, then how much debt was outstanding?

?a. 4,586,179

b. 4,827,557

c. 5,081,639

d. 5,349,094

e. 5,630,625