The Smith-James Bank Has an ROE of 17

question 9

Multiple Choice

The Smith-James Bank has an ROE of 17.5%,an asset utilization ratio of 13%,and a net profit margin of 9%.What is the bank's ROA?

• A)14.96 percent
• B)1.58 percent
• C)1.17 percent
• D)134.62 percent
• E)None of the options is correct

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Definitions:

Carrying Amount

The value of an asset or liability as recorded in a company's books, reflecting its cost minus any depreciation or amortization.

Land Improvements

Enhancements made to a parcel of land to increase its value, such as landscaping, drainage systems, and sidewalks, which are typically depreciatable over their useful life.

Diminishing-Balance Method

A method of calculating depreciation on an asset, where the depreciation expense decreases over time, applying a constant rate to the reducing book value of the asset.