What is the Return on equity

Business & Finance
Tutor: None Selected Time limit: 1 Day

total asset turnover of 1.95; net profit margin of 4.06%; total assets to equity ratio for the firm is 2.4. To get the return on equity, would I have to multiply each of these values together?

Aug 22nd, 2015

Thank you for the opportunity to help you with your question!

return on equity is the amount of net income returned as a percentage of shareholders equity. Return on equity measures a corporation's profitability by revealing how much profit a company generates with the money shareholders have invested.

Net income ÷ shareholders’ equity

Please let me know if you need any clarification. I'm always happy to answer your questions.
Aug 22nd, 2015

i will be providing you with the correct values shortly

Aug 22nd, 2015

ROE = net profit margin × asset turnover ×equity multiplier

so you will simply multiply all through

Aug 22nd, 2015

Awesome, thanks again!

Aug 22nd, 2015

most wellcome

Aug 22nd, 2015

Hi again, how would I go with calculating return on common equity. It is so confusing. I have the balance sheet and income statement but with what I have, it doesn't show the preferred dividends, and beginning and ending common equity

Aug 22nd, 2015

give me some time and i will give you the way out

Aug 22nd, 2015

Return on common equity.docx here is what I have. please show me the calculations to getting the return on common equity. Thank you.

Aug 22nd, 2015

http://image.slidesharecdn.com/ch2doc2256/95/ch2doc-9-728.jpg?cb=1275465207

open that document and see if it will help you solve the question am currently having alot of work load to be delivered in an hour to come.when am through i will give you the exact solution

Aug 22nd, 2015

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