Corbin, Inc

Multiple Choice

Corbin, Inc. had net income of $150,000 on sales of $5,000,000 during 2016. In addition, the firm's total assets were $2,500,000, and its capital structure is comprised of 40% debt and 60% equity. What was Corbin's return on equity in 2016?

A) 15%
B) 2.5%
C) 10%
D) Return on equity cannot be determined with the information provided.