Question

Use the following information to solve for ROA. Your answer should be entered as a percent. For example 7.31% should be entered as 7.31. Include two decimals and a negative if appropriate

Current Assets are $54, net fixed assets are $170, current liabilities are $124 and long term debt is $49

Revenue is $108, total operating expenses are $70, depreciation expense is $49

Interest expense is $25 and taxes are $33

Answer 1

ROA = Net Income / Total Assets
Net Income = Revenue - Total operating Expense - Interest Expense - Taxes
Net income = 108 - 70 - 25 - 33
Net Income = - 20
Total Assets = Current Assets + Net Fixed Assets
Total Assets = 54 + 170 = 224
ROA = Net Income / Total Assets
ROA = -20 / 224
ROA = -8.93
Depreciation expense is included in total operating expense

I hope this clear your doubt.

Feel free to comment if you still have any query or need something else. I'll help asap.

Do give a thumbs up if you find this helpful.