Based on the following information about Banks A and B, compute for each the return on assets (ROA), return on equity (ROE), and leverage ratio. a. Bank A has net profit after taxes of $1.8 million and the following balance sheet: The return on assets (ROA) for Bank A: ___% The return on equity (ROE) for Bank A: ___% The leverage ratio for Bank A: ___ Bank B has net profit after taxes of $1 million and the following balance sheet: Instructions: Enter your responses rounded to two decimal places.) The return on assets (ROA) for Bank B: ___% The return on equity (ROE) for Bank B: ___% The leverage ratio for Bank B: ___
Based on the following information about Banks A and B, compute for each the return on assets (ROA), return on equity (ROE), and leverage ratio. a. Bank A has net profit after taxes of $1.8 million and the following balance sheet: The return on assets (ROA) for Bank A: ___% The return on equity (ROE) for Bank A: ___% The leverage ratio for Bank A: ___ Bank B has net profit after taxes of $1 million and the following balance sheet: Instructions: Enter your responses rounded to two decimal places.) The return on assets (ROA) for Bank B: ___% The return on equity (ROE) for Bank B: ___% The leverage ratio for Bank B: ___
Cornerstones of Financial Accounting
4th Edition
ISBN:9781337690881
Author:Jay Rich, Jeff Jones
Publisher:Jay Rich, Jeff Jones
Chapter12: Fainancial Statement Analysis
Section: Chapter Questions
Problem 16MCQ
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Based on the following information about Banks A and B, compute for each the return on assets (ROA), return on equity (ROE), and leverage ratio.
a. Bank A has net profit after taxes of $1.8 million and the following balance sheet:
The return on assets (ROA) for Bank A: ___%
The return on equity (ROE) for Bank A: ___%
The leverage ratio for Bank A: ___
Bank B has net profit after taxes of $1 million and the following balance sheet:
Instructions: Enter your responses rounded to two decimal places.)
The return on assets (ROA) for Bank B: ___%
The return on equity (ROE) for Bank B: ___%
The leverage ratio for Bank B: ___
![Reserves
Loans
Securities
Assets
Bank Balance Sheet
(in millions)
$8
$50
$22
Liabilities and Capital
$80
$2
$8
Deposits
Borrowings
Bank Capital](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F9f4205f4-647a-4982-959f-fa42193f3ae0%2F1aa5bab1-6af7-4f31-883d-e6bd86917ef3%2Fmq96ou_processed.png&w=3840&q=75)
Transcribed Image Text:Reserves
Loans
Securities
Assets
Bank Balance Sheet
(in millions)
$8
$50
$22
Liabilities and Capital
$80
$2
$8
Deposits
Borrowings
Bank Capital
![Reserves
Loans
Securities
Assets
Bank Balance Sheet
(in millions)
$5
$45
$45
Liabilities and Capital
$75
$10
$10
Deposits
Borrowings
Bank Capital](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F9f4205f4-647a-4982-959f-fa42193f3ae0%2F1aa5bab1-6af7-4f31-883d-e6bd86917ef3%2Fayi517_processed.png&w=3840&q=75)
Transcribed Image Text:Reserves
Loans
Securities
Assets
Bank Balance Sheet
(in millions)
$5
$45
$45
Liabilities and Capital
$75
$10
$10
Deposits
Borrowings
Bank Capital
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