Financial Accounting
What is the relationship between leverage and ROE?
A company has an ROE of 8%. What does this suggest about its financial performance compared to a company with an ROE of 15%?
Why is it important to exclude preferred equity when calculating ROE?
Company B has a net income of \$750,000 and average common equity of \$3,000,000. Calculate its ROE.
How do you calculate average common equity?
A company has a net income of \$200,000 and average common equity of \$1,000,000. What is its ROE?
How does a high debt-to-equity ratio affect a company's ROE?
What does Return on Equity (ROE) measure?
Company A has a net income of \$500,000 and average common equity of \$2,500,000. Calculate its ROE.
What could cause a company to have a negative ROE?
