Question

Services had net income for the month of October of $ 23 comma 040. Assets as of the beginning and end of the month totaled $ 369 comma 000​, and $ 399 comma 000​, respectively. Calculate Matured Water​ Services' ROA for the month of October.

Answer 1

Answer:

6%

Explanation:

Given that,

Net income = $23,040

Beginning assets = $369,000

Ending Assets = $399,000

Average Total assets:

= (Beginning assets + Ending Assets) ÷ 2

=  ($369,000 + $399,000) ÷ 2

= $384,000

Therefore,

Return on assets:

= (Net income ÷ Average assets) × 100

= ($23,040 ÷ $384,000) × 100

= 0.06 × 100

= 6%

Hence, Matured Water​ Services' ROA for the month of October is 6%.