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3 years ago

Why do equity holders care more about roe than about roa?

Business

1 answer:

svetoff [14.1K]3 years ago

4 0

C. ROE measures how much equity holders are earning, while ROA measures how efficiently the bank is being run.

ROE = net income/ shareholder's equity

ROA= net income/total assets

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The financial staff of Cairn Communications has identified the following information for the first year of the roll-out of its n

Dmitrij [34]

Answer:

$9,600,000

Explanation:

The computation of the projected operating cash flow is given below:

= EBIT × (1 - tax rate) + depreciation expense

where

EBIT should be

= $20,000,000 - $8,000,000 - $6,000,000

= $6,000,000

Now the operating cash flow should be

= $6,000,000 × (1 - 0.40) + $6,000,000

= $3,600,000 + $6,000,000

= $9,600,000

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3 years ago

Your team consists of five members, in separate locations, who are collaborating on a lengthy report. Your team is in the initia

Molodets [167]

Answer:C. Web conferencing

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conferencing,presentations and trainings and team meetings etc can be conducted though the internet.

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3 years ago

Read 2 more answers

Five months ago Wilson opened up a health club. Which of the following is an implicit cost related to the health club? Group of

polet [3.4K]

Answer:

Wilson previously worked as an accountant, earning $3,000 a month.

Explanation:

Implicit costs or opportunity costs are the extra costs or benefits lost from choosing one activity or investment over another alternative.

In this case, Wilson had to quit his former job as an accountant in order to open his health club. So the salary that Wilson could have earned as an accountant would be the opportunity cost of opening his club.

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3 years ago

Select the incorrect statement regarding relevant costs and revenues. Group of answer choices Sunk costs are never relevant for

raketka [301]

Answer:

The incorrect statement regarding relevant costs and revenues:

To be relevant, a cost or revenue must not be future-oriented and must differ between the alternatives.

Explanation:

For a cost or revenue to be considered as relevant, it must be incurred or earned at a future time. It must also differ between the options available for decision making. A cost or revenue cash flow is relevant if it arises from a management decision and can be avoided. This simply means that if the cost or revenue is not affected by management decision or does not make any difference in decisions, it is not relevant.

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3 years ago

The term that describes what occurs when a manager does what is in his/her best interests and not what is in the best interests

Rom4ik [11]

Answer:

Lowballing

Explanation:

4 0

3 years ago

Why do equity holders care more about roe than about​ roa?

Why do equity holders care more about roe than about roa?