Arrow's Net Income of $117 Million and Average Assets of $1,400

question 53

True/False

Arrow's net income of $117 million and average assets of $1,400 million results in a return on assets of 8.36%.
Return on Assets = Net Income/Average Assets
Return on Assets = $117 million/$1,400 million = 8.36%

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Definitions:

Net Income

The total profit or loss of a company after all income and expenses, including taxes, have been accounted for.

Common Size Balance Sheet

A balance sheet that displays all line items as a percentage of a common base figure, enabling comparison across different periods or companies.

Accounts Receivable

Money owed to a company by its customers for goods or services sold on credit.

Total Assets

The combined value of all owned resources that have economic value and can be converted into cash. This includes both current and non-current assets.