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The Return on Equity for a Company That Has Sales

question 52

True/False

The return on equity for a company that has sales of $50,000, net income of $25,000 and average Stockholders' Equity of $125,000 is 20%.


Definitions:

Bankruptcy Filings

The formal process by which a company or individual legally declares their inability to pay their debts.

Chapter 7

A chapter of the U.S. Bankruptcy Code that provides for the liquidation of a debtor's assets to repay creditors.

Joint Ventures

A business arrangement in which two or more parties agree to pool their resources for the purpose of accomplishing a specific task.

Sole Proprietorships

A type of business entity owned and operated by one individual, without any legal distinction between the owner and the business.

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