Nikko corp.'s total common equity at the end of last year was $305,000 and its net income after taxes was $60,000. what was its roe?

a. 16.87%
b. 17.75%
c. 18.69%
d. 19.67%
e. 20.66%

Return on equity

= Net income after tax     x 100

  Total common equity

= $60,000  x  100

  $305,000  

= 19.67%          

The correct answer is D                  

Explanation:

Return on equity is the ratio of net income after tax to total common equity multiplied by 100. The net income amounts to $60,000 while the total common equity is $305,000. The division of net income by total common equity multiplied by 100 gives the return on equity.                  

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answer/// equals both average variable cost and average total cost at their respective minimums;