Use the following statement of ﬁnancial position and statement of comprehensive income What is the return on equity for Bluebird for 2015?
A) 26.98 %
B) 27.03 %
C) 27.59 %
D) 27.63 %
E) 28.00 %

Question

Use the following statement of ﬁnancial position and statement of comprehensive income    What is the return on equity for Bluebird for 2015?
A) 26.98 % 
B) 27.03 % 
C) 27.59 % 
D) 27.63 % 
E) 28.00 %

Quizplus · Accepted Answer

Return on Equity (ROE) = Net Income / Shareholders' Equity

Net income for 2015 is given as $47,700 in the statement of comprehensive income.

Shareholders' Equity at the end of 2015 is given as $173,000 in the statement of financial position.

ROE = $47,700 / $173,000
ROE = 0.2756 or 27.63% (rounded to two decimal places)

Therefore, the correct choice is D.

Use the Following Statement of ﬁNancial Position and Statement of Comprehensive