Computing Return on Equity and Return on Assets The following table contains financial statement information for Walmart Inc. 5 millions Total Assets Net Income Sales Equity 2018 $219,295 $6,670 $510.329 $72,496 2017 495,761 77,869 9,862 13,643 481,317 77.798 2016 204,522 198,825 . Compute return on equity (ROE) for the two recent years. Compute return on assets (ROA) for the two recent years. Compute profit margin (PM) for the two recent years. Compute asset turnover (AT) for the two recent years.. • Round ROE, ROA and PM to one decimal place (example: 0.2345 = 23.5%). • Round AT to two decimal places (example: 1.35).
Computing Return on Equity and Return on Assets The following table contains financial statement information for Walmart Inc. 5 millions Total Assets Net Income Sales Equity 2018 $219,295 $6,670 $510.329 $72,496 2017 495,761 77,869 9,862 13,643 481,317 77.798 2016 204,522 198,825 . Compute return on equity (ROE) for the two recent years. Compute return on assets (ROA) for the two recent years. Compute profit margin (PM) for the two recent years. Compute asset turnover (AT) for the two recent years.. • Round ROE, ROA and PM to one decimal place (example: 0.2345 = 23.5%). • Round AT to two decimal places (example: 1.35).
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:Computing Return on Equity and Return on Assets
The following table contains financial statement information for Walmart Inc.
5 millions Total Assets Net Income Sales Equity
$219,295
$6,670 $510.329 $72,496
204,522
9,862 495,761 77,869
13,643 481,317 77,798
198,825
2018
2017
2016
Compute return on equity (ROE) for the two recent years.
Compute return on assets (ROA) for the two recent years.
Compute profit margin (PM) for the two recent years.
Compute asset turnover (AT) for the two recent years..
• Round ROE, ROA and PM to one decimal place (example: 0.2345= 23.5%).
• Round AT to two decimal places (example: 1.35).
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Step 1: Introduce to return on assets and return on equity
VIEWStep 2: Working for average total assets
VIEWStep 3: Working for average equity
VIEWStep 4: Working for return on equity
VIEWStep 5: Working for return on assets
VIEWStep 6: Working for profit margin
VIEWStep 7: Working for asset turnover
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