Arrow's Net Income of $120 Million and Average Total Assets

question 68

True/False

Arrow's net income of $120 million and average total assets of $1,500 million results in a return on assets of 8%.

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Definitions:

Ownership

Refers to the legal rights and interests a person or entity has in a property, asset, or business, entitling them to use, manage, and enjoy its benefits.

Owner's Drawings

Withdrawals made by the owner from the business for personal use, considered as a reduction in the equity.

Owner's Capital

The amount of money and assets invested in a business by its owner, minus any withdrawals.

Net Income

The residual financial gain of a business following the deduction of every expense, tax, and cost from its total revenue.