Answer:
9.98%
Explanation:
The total debt was $651,000
And, the total debt ratio is 0.33
So by considering the above information, we can find out the total assets value which is
= $651,000 ÷ 0.33
= $1,972,727.27
Now according to the accounting equation
The total assets = Total liabilities + owners equity
$1,972,727.27 = $651,000 + owners equity
So, owners equity = $1,321,727.27
And, the return on equity is
Return on equity = (Net income) ÷ (total equity)
14.9% = Net income ÷ $1,321,727.27
Hence, net income = $196,937
And, the return on assets equal to
= (Net income) ÷ (Total assets)
= $1,321,727.27 ÷ $1,972,727.27
= 9.98%
