Final answer:
The Return on Assets for BC Corporation, calculated by dividing net income by total assets and converting to a percentage, is approximately 8%, indicating the company's effectiveness in using its assets to generate earnings.
Step-by-step explanation:
The question you're asking relates to calculating the Return on Assets (ROA) for BC Corporation. ROA is a financial ratio that measures how effectively a company is using its assets to generate earnings. You can calculate ROA by dividing the net income by the total assets and then multiplying by 100 to get a percentage. Using the provided figures for BC Corporation, with a net income of $176,000 and total assets of $2.24 million, the ROA calculation would be:
ROA = (Net Income / Total Assets) × 100
ROA = ($176,000 / $2,240,000) × 100 = 7.857%
When rounded to the nearest whole number, the ROA for BC Corporation is approximately 8%. It is important to note that ROA can be a significant indicator of a company's profitability and operational efficiency. Investors and managers often use this metric to assess how well a company is deploying its assets.