Calculating ROA and Its Components. Nucor, a steel manufacturer, reported net income for 2008 of $1,831 million on sales of $23,663 million. Interest expense for 2008 was $135 million, and noncontrolling interest was $314 million for 2008. The income tax rate is 35%. Total assets were $9,826 million at the beginning of 2008 and $13,874 million at the end of 2008. Compute the rate of ROA for 2008 and disaggregate ROA into profit margin for ROA and assets turnover components.

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Q: Need answer

A: Reference: Saylor Academy. (n.d.). The DuPont Equation, ROE, ROA, and Growth: The DuPont Equation |…

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A: Net profit margin =

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A: Formula: ROA = Net Income / Average Total Assets.

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Deferred Tax

Deferred tax is an estimated future tax which is made while preparing accounts. It is estimated as a result of past and present transactions in the financial statements. It is not the actual tax which needs to be paid or refundable from the revenue authority, it is an accounting entry. It exists because of the difference between accounting profits and taxable profits.