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Question
The profit figure is to be taken into account for calculating return on shareholders equity is ____________.
The profit figure is to be taken into account for calculating return on shareholders equity is ____________.
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Solution
The correct option is A net profit after tax
ROE (Return on Equity) is the amount of net profit returned as a % of shareholders equity. ROE measures company's profitability by reveling how much profit the company has generated on shareholder's equity. The formula for calculating the ROE is as under:
ROE= Net Profit after Tax/Shareholders Equity.
ROE (Return on Equity) is the amount of net profit returned as a % of shareholders equity. ROE measures company's profitability by reveling how much profit the company has generated on shareholder's equity.
The formula for calculating the ROE is as under:
ROE= Net Profit after Tax/Shareholders Equity.
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