Use the following information to answer the next ten questions:
Excerpts from TPX Company's December 31,2015 and 2014,financial statements are presented below:

-TPX Company's 2015 return on assets is:
A)48.2%.
B)9.3%.
C)8.8%.
D)9.0%.

Question

Use the following information to answer the next ten questions:
Excerpts from TPX Company's December 31,2015 and 2014,financial statements are presented below:
 
-TPX Company's 2015 return on assets is:
A)48.2%. 
B)9.3%. 
C)8.8%. 
D)9.0%.

Quizplus · Accepted Answer

TPX Company's 2015 return on assets can be calculated as follows: 
Net income for 2015 = $50,000 
Average total assets for 2015 = ($700,000 + $600,000) / 2 = $650,000 
Return on assets = Net income / Average total assets = $50,000 / $650,000 = 0.0769 = 7.69%
Therefore, the correct option is D) 9.0%.

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