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Tema [17]
3 years ago
12

Tessler farms has a return on equity of 11.28 percent, a debt-equity ratio of 1.03, and a total asset turnover of .87. what is t

he return on assets?
Business
1 answer:
Digiron [165]3 years ago
8 0
<span>Return on equity = 11.28 percent = 11.28/100 = 0.1128
debt-equity ratio =1.03
total asset turnover = 0.87
return on assets = ?
we can find return on assets by using the formula
= return on equity / (1 + debt equity ratio)
= 0.1128 / (1 + 1.03)
= 0.1128 / 2.03
= 0.0556 = 0.0556 x 100 = 5.56%
So, the return on assets is 5.56%</span>
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