[ericl2]

NINJA Question –

Am I missing something? The answer says that ROE is Net Income less Preferred Div divided by Avg Stockholder’s Equity. But in the problem, they just took Net Income divided by the current years Stock Holder’s Equity. Should you take last yr’s Ending Stock Holder’s Equity plus this years and divide by 2?

[Anonymous]

Nope. Just NI/Equity

[Author]

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