A firm with negative earnings must therefore also have a


1. A firm with negative earnings must therefore also have a negative cash flow after tax.

True or False

2. Because net worth is calculated as total assets minus total debt and total equity it can be zero, positive, or negative.

True or False

3. A firm has net income of 197,400, a return on assets of 8.4% and a debt equity ratio of .72. What is the return on equity?

1. 11.67 2. 18.98 3. 14.45 4.16.22 5. 15.06

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Financial Management: A firm with negative earnings must therefore also have a
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