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Excerpts from Dowling Company's December 31,2016 and 2015,financial statements and key ratios are presented below (all numbers are in millions):

-Dowling's return on equity for 2016 is (rounded):

Question

Use the following to answer questions 
Excerpts from Dowling Company's December 31,2016 and 2015,financial statements and key ratios are presented below (all numbers are in millions):
 
-Dowling's return on equity for 2016 is (rounded):

Quizplus · Accepted Answer

Return on equity (ROE) = Net income / Average shareholders' equity
Average shareholders' equity for 2016 = [($620 + $540) / 2] = $580 million
Net income for 2016 = $140 million
ROE = $140 million / $580 million = 0.2414 or 24.1% (rounded to one decimal place)
The closest answer choice is B, which is 24.3%.

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