Net income available to stockholders is Rs 125 and total assets are Rs 1,096 then return on common equity would be
A. 0.11%
B. 11.40%
C. 0.12 times
D. 12.00%
Answer: Option B
Solution(By Examveda Team)
Net income available to stockholders = 125
Total assets = 1,096
Return on common equity rate shows the net income earned per every rupee invested.It acts as a yardstick of profitability.
Return on common equity
= (net income - preferential stock)/Average common stock holder's equity
No further information is available
= (125/1096)×100
= 11.4051 ℅
This Question Belongs to Commerce >> Financial Management
Investment is the _______________.
A. net additions made to the nation’s capital stocks
B. person’s commitment to buy a flat or house
C. employment of funds on assets to earn returns
D. employment of funds on goods and services that are used in production process
Financial Management is mainly concerned with ______________.
A. All aspects of acquiring and utilizing financial resources for firms activities
B. Arrangement of funds
C. Efficient Management of every business
D. Profit maximization
The primary goal of the financial management is ____________.
A. to maximize the return
B. to minimize the risk
C. to maximize the wealth of owners
D. to maximize profit
In his traditional role the finance manager is responsible for ___________.
A. proper utilisation of funds
B. arrangement of financial resources
C. acquiring capital assets of the organization
D. efficient management of capital
Join The Discussion