Question

Baugh & Essary has a NI of $149,200, sales of $936,800, a CIR of 0.74, and an equity multiplies of 1.5. What is the ROE?

Answer 1

To find the ROE, we need the total assets.

Step-by-step explanation:

To find the Return on Equity (ROE), we can use the formula ROE = Net Income / Average Equity. The net income (NI) is given as $149,200. To find the average equity, we need to calculate the equity multiplier. The equity multiplier is calculated as Total Assets / Total Equity. Unfortunately, the total assets are not given in the question.

Therefore, we cannot determine the ROE without additional information. We would need to know the total assets in order to calculate the equity multiplier and then find the average equity. Once we have the average equity, we can plug it into the ROE formula.