Answer:
6%
Explanation:
Calculation for Cowl's rate of return on assets for 20X4
Using this formula
Rate of return on assets=Net income/[(Total assets January 1, Year 4 +Total assets, December 31, Year 4)/2]
Let plug in the formula
Rate of return on assets= $150,000/[($2,000,000 + $3,000,000)/2]
Rate of return on assets= $150,000/($5,000,0000/2)
Rate of return on assets= $150,000/2,500,000
Rate of return on assets= 0.06×100
Rate of return on assets= 6%
Therefore Rate of return on assets will be 6%
