Question

The monarchs corporation has net income of $175,000.00, interest payable of $5,000.00, interest expense of $3,000.00, and average total assets of $75,000.00. Calculate the rate on total assets?

Please help!!!

Answer 1

I believe that first one should add the $175,000 to the $5000 = $180000 - $3000=$177,000/75,000= 236% of assets would be the rate of return based on the assets which is a pretty high rate of return and means the assets are being very wisely used.