Big K Grocer’s financial statements show average shareholders’ equity of $5,103 million, net income of $700 million, and average total assets of $23,175 million.
How much is Big K Grocer’s return on assets for the year?

Question

Big K Grocer’s financial statements show average shareholders’ equity of $5,103 million, net income of $700 million, and average total assets of $23,175 million.   
 How much is Big K Grocer’s return on assets for the year?

BlackTom AI · Accepted Answer

To determine return on assets (ROA), we use the formula ROA = Net Income / Average Total Assets.

Option 1: 21.42% — This would require Net Income to be about 21.42% of average assets. Calculating 21.42% of 23,175 yields roughly 4,955, which is far from the reported net income of 700. Hence this is incorrect.

Option 2: 3.02% — This is very close to 700 / 23,175. In fact, 23,175 × 0.0302 = 699.885, which is essentially 700 when rounded to the nearest million. Therefore this percentage aligns with the given figures.

Option 3: 4.77% — If ROA were 4.77%, then net income would be about 4.77% of 23,175, which equals roughly 1,105. This is not equal to the stated net income, so this option is inaccurate.

Option 4: 21.24% — This implies net income near 23,175 × 0.2124 ≈ 4,925, far from 700. This discrepancy shows the option is incorrect.

In summary, the correct proportion of net income to average total assets is around 0.0302, i.e., 3.02%, which matches the provided numbers when performing the division.

Big K Grocer’s financial statements show average shareholders’ equity of $5,103 million, net income of $700 million, and average total assets of $23,175 million. How much is Big K Grocer’s return on assets for the year?

查看解析

登录即可查看完整答案

类似问题

Over the Hill Corporation has total asset turnover of 3.5 and a net profit margin of 5.2%. What is Over the Hill Corporation’s return on assets?

From the information provided below, what is the return on assets? Show your answer as a percentage, rounded to two decimal places. Net profit after tax $72,113 Opening balance of total assets 440,615 Closing balance of total assets 519,017

Question at position 6 A high Return on Assets (ROA) is an indication that a company has a high level/value of assets compared to a low profit margin.TrueFalse

Calculate GreenTech’s Return on Assets. Note: Round to two decimal places and provide your answer in percent without the unit sign, i.e., X,XXX.XX.

Calculate GreenTech’s Return on Assets. Note: Round to two decimal places and provide your answer in percent without the unit sign, i.e., X,XXX.XX.

更多留学生实用工具

考试浏览器助手

风格化写作助手

论文查重助手

文献引用助手

课堂转译助手

课堂笔记助手

Quiz搜索助手

学校历年真题

智能刷题助手

智能匹配练习

希望你的学习变得更简单