Foreign companies listed on U.S.stock exchanges must reconcile their net income and stockholders' equity to U.S.GAAP. Which ratios can be calculated with the information provided in this reconciliation?
A)operating profit margin
B)asset turnover
C)return on equity
D)current ratio

Question

Quizplus · Accepted Answer

The reconciliation of net income and stockholders' equity to U.S. GAAP allows us to calculate the return on equity (ROE) ratio, which is a measure of how efficiently the company is using its equity to generate profits. The other ratios, such as operating profit margin, asset turnover, and current ratio, require additional financial information beyond the reconciliation.

Foreign Companies Listed on U