ROE Net Income/Shareholder equity Retention Ratio Retained earning/net income SGR Retention ratio x ROE 2020 0,0988 10,74 10,919711 1,03 1,08 2021 0,09593
Financial Ratios
A Ratio refers to a figure calculated as a reference to the relationship of two or more numbers and can be expressed as a fraction, proportion, percentage, or the number of times. When the number is determined by taking two accounting numbers derived from the financial statements, it is termed as the accounting ratio.
Return on Equity
The Return on Equity (RoE) is a measure of the profitability of a business concerning the funds by its stockholders/shareholders. ROE is a metric used generally to determine how well the company utilizes its funds provided by the equity shareholders.
Critically explain two of the business capital investment decisions
According to the ratio critically analyze how they are related to their long-term business strategy and the contribution to their economic sustainability by creating value.
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