Chapter 24 discusses various methods of analyzing financial statements in terms of calculating ratios. Specifically, Return on Assets (ROA) is a very simple calculation: ROA= Net Income/Average Total Assets. Another method at arriving at this ratio is the DuPont Equation that was discussed in your textbook. In looking at the DuPont Equation, what benefits are derived by using this method rather than the most typical method that I have described above

Chapter 24 discusses various methods of analyzing financial statements in terms of calculating ratios. Specifically, Return on Assets (ROA) is a very simple calculation: ROA= Net Income/Average Total Assets. Another method at arriving at this ratio is the DuPont Equation that was discussed in your textbook. In looking at the DuPont Equation, what benefits are derived by using this method rather than the most typical method that I have described above

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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