Return on equity: Will be the same as return on investment. Relates dividends and owner\'s equity, Relates net income and owners1 equity. Rebates dividends and turnover.
Solution
Return on equity
Answer: Relates net income and owener\'s equity.
Return on equity ( ROE ) is the amount of net income returned as a percentage of shareholders equity. It reveals how much profit a company earned in comparison to the total amount of shareholder equity found on the balance sheet.
ROE is one of the most important financial ratios and profitability metrics. It is often said to be the ultimate ratio or the ‘mother of all ratios’ that can be obtained from a company’s financial statement. It measures how profitable a company is for the owner of the investment, and how profitably a company employs its equity.
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Return on equity- Will be the same as return on investment- Relates.docx
1. Return on equity: Will be the same as return on investment. Relates dividends and owner's
equity, Relates net income and owners1 equity. Rebates dividends and turnover.
Solution
Return on equity
Answer: Relates net income and owener's equity.
Return on equity ( ROE ) is the amount of net income returned as a percentage of shareholders
equity. It reveals how much profit a company earned in comparison to the total amount of
shareholder equity found on the balance sheet.
ROE is one of the most important financial ratios and profitability metrics. It is often said to be
the ultimate ratio or the ‘mother of all ratios’ that can be obtained from a company’s
financial statement. It measures how profitable a company is for the owner of the investment,
and how profitably a company employs its equity.
