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4. The formula which breaks down the return on equity into three component parts is referred to as which one of the following

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Answer #1

Part 4:
Answer: Option D is correct.
Du Pont identity breaks down the return on equity into three component parts. It is also called as Dupont formula. The three components are net profit margin, return on assets and financial leverage respectively.

Return on equity=(Net profit margin)*(Return on assets)*(Financial leverage)

The formula for the individual components are:
Net profit margin=Net profit/Sales
Return on assets=Sales/Assets
Financial leverage=Assets/Equity

Part 5:
Answer: Option D is correct.
Increase in accounts payable is considered as a source of cash. Increase in accounts payable means a company is delaying its payments to its suppliers. So, the company is holding on to the cash for longer time, which is a source of cash.
All the other options given shows the use of cash.

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