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denis23 [38]
4 years ago
12

The following table contains financial statement information for Izzy Corporation. ($ millions) Total Assets Net Income Sales Eq

uity 2016 $105,000 $10,000 $95,000 $30,000 2017 $125,000 $11,000 $100,000 $31,000 Compute the return on equity (ROE) and return on assets (ROA) for 2017.
Business
1 answer:
ser-zykov [4K]4 years ago
5 0

Answer:

The ROE for 2017 is 35.48% while the ROA for 2017 is 9.565%

Explanation:

The return on equity (ROE) is the return the company earns over the shareholders equity. It is a profitability measure in relation to a business's equity. The formula for ROE is,

ROE = Net Income / Shareholder's Equity

The return on assets, on the other hand, is the return earned by a company over the total assets employed. It is a profitability measure in relation to the total assets of a business. The formula for ROA is,

ROA = Net Income / Average Total assets

Where,

Average total assets = (Total assets at start + Total assets at end) / 2

<u>For 2017:</u>

ROE = 11000 / 31000  =  0.3548 or 35.48%

Average total assets = (105000 + 125000) / 2   = $115000

ROA = 11000 / 115000   =  0.09565 or 9.565%

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4 0
1 year ago
The yield on a one-year Treasury security is 5.3800%, and the two-year Treasury security has a 6.4560% yield. Assuming that the
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Answer:

7.5430%

Explanation:

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THe formula to use would be:

\frac{(1+r_{2})^n}{(1+r_{1})^n}-1

Where

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and

r_1 is the yield of 1 year security ( here, n = 1)

Now, substituting, we get:

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3 years ago
Off-balance sheet activities involving guarantees of securities and back-up
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B) increase the risk a bank faces.

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3 years ago
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3 years ago
In its first year of operations, Roma Company reports the following. Earned revenues of $54,000 ($46,000 cash received from cust
lesya692 [45]

Answer:

The Net Income in terms of Cash is $13600 while that of accrual basis is $24000.

Explanation:

As the complete question is not given, a similar  question is found online and is attached herewith.

By using the given data

Cash Values are given as

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Total Expense Cash=$23400 +$9000

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