Chapter 17, Problem 17DQ

To determine

Concept Introduction:

Rate of Return on total assets:

Rate of Return on total assets can be defined as the ratio that measures a company's net income against its total net assets or average total assets.

Rate of Return on total assets can be calculated as −

$\text{Rate of Return on Total Assets= }\frac{\text{Net Income}}{\text{Average Total assets}}$

Now, the average total assets are calculated as −

$\text{Average total assets=}\frac{\text{Beginning Total assets+Ending total assets}}{\text{2}}$

To compute:

Rate of return on total assets for the year ended December 31, 2017