A company reports the following income statement and balance sheet information for the current year:
Net income $ 410,000
Interest expense 90,000
Average total assets 5,000,000
Determine the rate earned on total assets.
Answer: Rate Earned on Total Assets = Net Income + Interest Expense Average Total Assets Rate Earned on Total Assets = Rate Earned on Total Assets = $410,000 + $90,000 $5,000,000 $500,000 $5,000,000 Rate Earned on Total Assets = 10.0%
