f Turnpoint Inc. has net income of $300,000, assets of $3,000,000, sales of $2,000,000, and debt of 1,300,000, what is their ROE?

Cornerstones of Financial Accounting
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Chapter12: Fainancial Statement Analysis
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Problem 15MCQ: Hummel Inc. has $30,000 in current assets and $15,000 in current liabilities. What is Hummels...
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If Turnpoint Inc. has net income of $300,000, assets of $3,000,000, sales of $2,000,000, and debt of 1,300,000, what is their ROE? 

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Step 1

Return on Equity is a profitability metric that calculates the net income earned as a % of equity.

In this question, we are given the net income. We need to determine the value of equity by using the balance sheet principle as below:

Total assets = equity + debt

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