ACCOUNTING AND FINANCIAL ENGINEERING - EXAMPLE 34.37 : A biochemical engineering professional applies 5-step Du Pont formula in the accounting. Let Net Income = A, Earning Before Tax (EBT) = B, Earning Before Interest, Tax (EBIT) = C, Net Sales = D, Total Assets = E, Shareholders Equity = F. Let Tax Burden = A / B = 0.75, Interest Burden = B / C = 1.05, EBIT Margin = C / D = 0.27, Asset Turnover = D / E = 0.66, Return on Equity = A / F = 0.37. (a) Calculate the value of Leverage = E / F. (b) If AB + BC + CD + DE + EF = $$ 141932, find the values of A, B, C, D, E and F.
- 1 Answers
- 1523 Views
- I also Faced
- E-Mail Answers
Answer Posted / kangchuentat
ACCOUNTING AND FINANCIAL ENGINEERING - ANSWER 34.37 : (a) Leverage = E / F = (A / F) / [ (A / B) (B / C) (C / D) (D / E) ] = 0.37 / [ (0.75) (1.05) (0.27) (0.66) ] = 2.6366. (b) Let 6 simulteneous equations with 6 unknowns could be formed where A / B = 0.75, B / C = 1.05, C / D = 0.27, D / E = 0.66, AB + BC + CD + DE + EF = 141932 = G. Simple computer programming could be used to perform trial-and-error calculation. For example, DATA : What-if Analysis : Goal Seek in Excel 2013 is able to set the value of G to 141932 by changing the value of A, B, C, D, E or F. Finally A ≈ $48, B ≈ $64, C ≈ $61, D ≈ $226, E ≈ $342, F ≈ $129. The answer is given by Kang Chuen Tat; PO Box 6263, Dandenong, Victoria VIC 3175, Australia; SMS +61405421706; chuentat@hotmail.com; http://kangchuentat.wordpress.com.
| Is This Answer Correct ? | 0 Yes | 0 No |
Post New Answer View All Answers
What is the definition of 'good' cooling tower water?
Can asphalt be recycled to form a useful product?
What is a good method of steam tracing large vessels?
Why should a magnesium ribbon be cleaned before burning in air?
Do you have any idea on recombinant protein expression?
hello everyone do anyone have interview questions for any chemical industry please email me at
Explain what are the assumptions made on conservation equation?
how does refractive index detector work?
Define octane number?
How can you estimate the efficiency of a pump?
sir i am appearing in railway exam of section engineer and my branch is chemical engineering i want previous question paper of section engineer of chemical branch please tell me as soon as possible my email id is surendrasaroj18@gmail.com THANKYOU
oil field interview question
What are the assumptions made on conservation equation?
Are you having any experience in antibody designing?
Explain why does catalytic converter used in an automobile?
