Use the table for the question(s)below.
Consider the following income statement and other information:
Luther Corporation
Consolidated Income Statement
Year ended December 31 (in $ millions)
-Wyatt Oil has a net profit margin of 4.0%,a total asset turnover of 2.2,total assets of $525 million,and a book value of equity of $220 million.Wyatt Oil's current return-on-assets (ROA)is closest to:
A)8.8%.
B)9.5%.
C)21.0%.
D)22.8%.

Question

Use the table for the question(s)below.
Consider the following income statement and other information:
Luther Corporation
Consolidated Income Statement
Year ended December 31 (in $ millions) 
-Wyatt Oil has a net profit margin of 4.0%,a total asset turnover of 2.2,total assets of $525 million,and a book value of equity of $220 million.Wyatt Oil's current return-on-assets (ROA)is closest to:
A)8.8%. 
B)9.5%. 
C)21.0%. 
D)22.8%.

Quizplus · Accepted Answer

ROA=Net profit margin * Total asset turnover=4.0%*2.2=8.8%

Use the Table for the Question(s)below