Speedy Has Net Income of $18,955,and Assets at the Beginning

question 102

Multiple Choice

Speedy has net income of $18,955,and assets at the beginning of the year of $200,000.Assets at the end of the year total $246,000.Compute its return on assets.

• A)7.7%.
• B)8.5%.
• C)9.5%.
• D)11.8%.
• E)13.0%.

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Definitions:

Dividends

Monies disbursed by a business to its owners, often coming from the profit the company makes.

Costs

The monetary valuation of effort, material, resources, time, and opportunity foregone in production and delivery of a good or service.

Retention Ratio

The proportion of a company's net income that is retained rather than paid out as dividends, indicating reinvestment back into the company.

Return on Assets

A financial ratio that indicates how profitable a company is relative to its total assets.