The numerator of the rate earned on total assets ratio is equal to
A) net income
B) net income plus tax expense
C) net income plus interest expense
D) net income minus preferred dividends

Question

Quizplus · Accepted Answer

The numerator of the rate earned on total assets ratio is net income plus interest expense, as it reflects the earnings available to both equity and debt holders.

The Numerator of the Rate Earned on Total Assets Ratio