::: vuaskari.com ::: Return of assets calculation

sir plz tel me in ROA calculation which amount we take as net income 

1. profit before tax
2. profit after tax 
3. EBIT

Dear Student:

For return on assets we take "profit before tax" in the numerator

For dupont return on assets we take "Profit after tax in the numerator"

Best Regards, 

Instructor

FINI619

 

 

FINI619 FINI619 <fini619@vu.edu.pk> date Sun, Jun 26, 2011 at 11:34 PM subject Re: ROA FORMULA confusion mailed-by vu.edu.pk

hide details 11:34 PM (11 hours ago)

AOA sir 

my answer of ROA are as follows

ROA= net profit before tax/ total assets* 100

Year 2008	Year 2009	Year 2010
21,886,740/445,285,758*100	23,349,146/511,741,878*100	26,509,636/570,481,863*100
4.91%	4.56%	4.65%

but sir according to MCB financial performance and Key Performance Indicators there is decrease in ROA FOR 2010

2010 = 3.13%

2009 = 3.25%

Plz tel me sir which one is correct

Dear Student,

 

Please do not match your answers of ratios with the ratios of bank as the item(s) for calculating ratios by the bank vary.

Your calculations are correct.

 

Regards,

Instructor (FINI619)

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"Listen to everyone and Learn from everyone
because 

Nobody knows everything but everyone knows something"

Admin Dua Waqar (MBA Finance) 

[CS507, MKT501 , FIN623 , FIN630 , FINI619, MGT613]

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