Linda's Clothing is a retailer of contemporary women's clothing. Selected financial information for Linda's appears below:

Required:
a. Compute the rate of return on assets for the years 2009-2011. Linda's has an effective tax rate of 35%.
b. Compute the rate of return on common shareholders' equity for the years 2009-2011.
c. Compute basic earnings per share for the years 2009-2011.
d. Interpret the changes in ROA versus ROCE and EPS over the three-year period.

Question

Linda's Clothing is a retailer of contemporary women's clothing. Selected financial information for Linda's appears below:
  
Required:
a. Compute the rate of return on assets for the years 2009-2011. Linda's has an effective tax rate of 35%.
b. Compute the rate of return on common shareholders' equity for the years 2009-2011.
c. Compute basic earnings per share for the years 2009-2011.
d. Interpret the changes in ROA versus ROCE and EPS over the three-year period.

Quizplus · Accepted Answer

The Answer of Linda's Clothing is a retailer of contemporary women's clothing. Selected financial information for Linda's appears below:
  
Required:
a. Compute the rate of return on assets for the years 2009-2011. Linda's has an effective tax rate of 35%.
b. Compute the rate of return on common shareholders' equity for the years 2009-2011.
c. Compute basic earnings per share for the years 2009-2011.
d. Interpret the changes in ROA versus ROCE and EPS over the three-year period.

Linda's Clothing Is a Retailer of Contemporary Women's Clothing