Return on equity or return on capital is the ratio of net income of a business during a year to its stockholders’ equity during that year. It is a measure of profitability of stockholders’ investments. It shows net income as percentage of shareholder equity. Formula The formula to calculate return on equity is: ROE = Annual Net Income Average Stockholders’ Equity Net income is the after tax income whereas average shareholders’ equity is calculated by dividing the sum of shareholders’
Premium Balance sheet Generally Accepted Accounting Principles Asset
000+20‚000+7‚000+10‚000) of capital at year-end 2008 and earned before interest but after taxes (EBIAT) 16‚000 (26‚000-10‚000) during 2008. Its return on capital was 14.29% (16‚000/112‚000) which represents an increase from the 8.11% (6‚000/74‚000) in 2005. 4. SciTronics had $75‚000 of owner’s equity and earned $14‚000 after taxes in 2008. Its return on equity was 18.66% ($75‚000/$14‚000) an improvement from the 8.1% ($5‚000/$61‚000) earned in 2005. Activity Ratios 1. Total Assets turnover
Premium Inventory Balance sheet Financial ratio
Income Tax Return Assignment You have your own CPA tax practice and you are greeted with new clients: Albert and Jenny Cunningham and their two children. You meet with them and they give you the information shown below. They would like you to prepare their tax return for 2013. They would like to file married filing jointly. NOTE: Reference to the “current tax year” below for the taxpayers‚ Albert and Jenny‚ it is for the calendar year 2013. Albert and Jenny Cunningham (both 42 years
Premium Taxation in the United States Insurance Taxation
ch10 Student: ___________________________________________________________________________ 1. The capital gains yield plus the dividend yield on a security is called the: A. geometric return. B. average period return. C. current yield. D. total return. 2. The expected return on a security in the market context is: A. a negative function of execs security risk. B. a positive function of the beta. C. a negative function of the beta. D. a positive function of the excess security
Premium Rate of return Arithmetic mean Risk
Risk and Return Assignment Questions 1. Suppose a stock begins the year with a price of $25 per share and ends with a price of $35 per share. During the year it paid a $2 dividend per share. What are its dividend yield‚ its capital gain‚ and its total return for the year? 2. An investor receives the following dollar returns a stock investment of $25: $1.00 of dividends Share price rise of $2.00 Calculate the investor’s total return. 3. Below are the probabilities for the economy’s five
Premium Stock Random variable Variance
Risk and Return: Portfolio Theory and Asset Pricing Models Portfolio Theory Capital Asset Pricing Model (CAPM) Efficient frontier Capital Market Line (CML) Security Market Line (SML) Beta calculation Arbitrage pricing theory Fama-French 3-factor model Portfolio Theory • Suppose Asset A has an expected return of 10 percent and a standard deviation of 20 percent. Asset B has an expected return of 16 percent and a standard deviation of 40 percent. If the correlation between A and B is 0.6
Premium
MODELLING ABNORMAL RETURN: A REVIEW ARTICLE Oleh Norman Strong Overview Paper ini memberikan panduan untuk metodologi event study dan menguraikan prosedur pemodelan return abnormal dan masalah yang terkait. Event Study Event study adalah nama yang diberikan pada penelitian empiris atas hubungan antara harga sekuritas dengan kejadian ekonomi (economic events). Kebanyakan event study memfokuskan pada perilaku harga saham dalam rangka untuk menguji apakah perilaku stokastik mereka dipengaruhi oleh pengungkapan
Premium
Returns to Scale Returns to scale is a concept that tries to explain the behaviour of the output in relation to the change in the total scale of operations of the firm. A change of scale of operations means a change in the total size of the firm‚ i.e. a change in both labour and capital of the firm. For determining the returns to scale‚ we need to calculate the Output Elasticity where: Output Elasticity = % change in Output/% change in all inputs The different types of returns to scales
Premium Microeconomics Function
CONTENTS Introduction…………………………………………………………………….………2 Define Capital Investment Appraisal…………………………….………………….…2 Discounted cash flow methods……….………………………….………………….…4 Explanation of NPV…………………… ...................................................................…4 Explanation of IRR…………….……………………….…….……..…………………5 Advantages and disadvantages...……..……………………………………….……….5 Project calculations........................................................
Premium Net present value Rate of return
The documentary Return to the Wild debates the two very different argued reasons of why Chris McCandless went into the wild. The writers choose to uncover the dark secrets of the McCandless family and to reveal the truth as to why Chris travelled into the Alaskan wilderness. The documentary adopts an intense tone in the beginning that shifts to a more light hearted attitude throughout the second half of the film using symbolism‚ cinematography‚ audio‚ and various interviews in order to explain to
Premium Into the Wild Wilderness Jon Krakauer