Management Efficiency Ratio
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This is my first accounting class and I am not very good at it. I would appreciate any assistance that I am given. My assignment is to complete a management efficiency ratio of both company's financial statement and give my findings for both.
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Response provides the steps to compute the Management Efficiency Ratio
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This is my first accounting class and I am not very good at it. I would appreciate any assistance that I am given. My assignment is to complete a management efficiency ratio of both company's financial statement and give my findings for both.
Let us understand the ratios which will be used to find the management efficiency:
1) Return on shareholder's equity= Net Income/Shareholder equity
The return on shareholder's equity is calculated to know see the profitability of owner's investment. It helps company to know how well the firm has used the resources of the owners. This information is of important interest to shareholders. The company's ROE can be compared with its competitor to analyze and anticipate the no. of investors would be interest in the company.
2) Return on assets ratio describes the relationship between the profit and the total asset utilization. It is calculated by Operating Profit/Assets
3) ...
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