Question

Bountiful Water Services had net income for the month of October of $ 40 comma 400. Assets as of the beginning and end of the month totaled $ 346 comma 000​, and $ 462 comma 000​, respectively. Calculate Bountiful Water​ Services' ROA for the month of October

Answer 1

The ROA for the month of October was 10%

Step-by-step explanation:

Return over Assets: It represent the yield of the company base on the resources it has during the period.

Return Over Assets = Net income / average Assets

were average assets = ( beginning + ending ) / 2

Net income $40,400

Beginning Assets $346,000

Ending Assets $462,000

Average Assets $404,000

ROA = 40,400/404,000 = 10%