A Firm Has a Profit Margin of 15 Percent on Sales

Multiple Choice

A firm has a profit margin of 15 percent on sales of $20,000,000. If the firm has a debt of $7,500,000, total assets of $22,500,000, and an interest cost on a total debt of 5 percent, what is the firm's return on total assets (ROA) ? (Round answer to two decimal places.)

A) 8.47%
B) 10.94%
C) 12.02%
D) 13.33%
E) 15.18%