Return on Equity

Written by Jerry Ratzlaff on . Posted in Manufacturing Engineering

Return on equity, abbreviated as ROE, is the ability of a firm to generate profits from its shareholders investments in the company.

 

return on equity Formula

\(\large{ ROE =  \frac{ NI }{ ASE }   }\)  

Where:

\(\large{ ROE }\) = return on equity

\(\large{ ASE }\) = average shareholders' equity

\(\large{ NI }\) = net income

 

Tags: Equations for Manufacturing