The financial ratio measured as net income divided by total equity is known as the firm's:
A)profit margin.
B)return on equity.
C)return on assets.
D)earnings before interest and taxes.
E)asset turnover.

Question

Quizplus · Accepted Answer

The ratio measured as net income divided by total equity is known as return on equity (ROE). This ratio measures the profitability of the shareholder's investment in the company.

The Financial Ratio Measured as Net Income Divided by Total