Question

When a firm has noncontrolling interests, analysts may compute and review all except which of the following return on equity ratios?

a. Return on Equity (ROE)
b. Return on Net Assets (RONA)
c. Return on Common Equity (ROCE)
d. Return on Investment (ROI)

Answer 1

Return on Equity (ROE), Return on Net Assets (RONA), and Return on Common Equity (ROCE) are ratios that can be computed and reviewed when a firm has noncontrolling interests, except for Return on Investment (ROI).

Step-by-step explanation:

When a firm has noncontrolling interests, analysts may compute and review all except the Return on Investment (ROI) ratio. The other three ratios, Return on Equity (ROE), Return on Net Assets (RONA), and Return on Common Equity (ROCE), are commonly used to evaluate a firm's profitability and efficiency. These ratios help analysts assess how well a company is utilizing its resources and generating returns for its shareholders.