Question

Chou Co. has a net income of $57,000, assets at the beginning of the year are $264,000 and assets at the end of the year are $314,000. Compute its return on assets.

Answer 1

18.15 %

Step-by-step explanation:

Return on Assets = net income / total assets x 100

Note : we use the asset value as at balance sheet date (end of period)

therefore,

Return on Assets = $57,000 / $314,000 x 100

= 18.15 %