Tamarack Outfitters (CAD thousands), 2025: net income 480; revenue 4,800; average total assets 3,700; average equity 2,000. Compute the three DuPont factors — net margin as a percentage to two decimals, asset turnover to two decimals, leverage (average assets ÷ average equity) to two decimals — and their product, ROE, as a percentage to one decimal.
Tamarack Outfitters (CAD thousands), 2025: net income 480; revenue 4,800; average total assets 3,700; average equity 2,000. Compute the three DuPont factors — net margin as a percentage to two decimals, asset turnover to two decimals, leverage (average assets ÷ average equity) to two decimals — and their product, ROE, as a percentage to one decimal.
Answer
Net margin % → 10 · Asset turnover → 1.3 · Leverage (avg assets ÷ avg equity) → 1.85 · ROE % → 24
Cells - Net margin % · ±0.05 - Asset turnover · ±0.01 - Leverage (avg assets ÷ avg equity) · ±0.01 - ROE % · ±0.1 Net margin 480 ÷ 4,800 = 10.00 %; asset turnover 4,800 ÷ 3,700 = 1.297; leverage 3,700 ÷ 2,000 = 1.85. Product: 0.1000 × 1.297 × 1.85 = 0.2400 = 24.0 %, which equals 480 ÷ 2,000 directly — the identity checks itself.
Bigel §6.3–6.4, §5.8; OpenStax Finance §6.6; Lyryx Intro FA §12.4