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Calculate the roa for year 2000

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Reference no: EM132664603

Carefree Company provides the following selected financial information for Year 2000:

Sales $17,633

Net Income $405

Interest expense before taxes $245

Preferred stock dividend $27

Tax rate 35%

Average total assets $17917.5

Average preferred equity $348

Average common equity $5901.5

(a) Calculate the ROA for Year 2000.

(b) Calculate the ROCE for Year 2000. (c) Did common shareholders benefit from the usage of debt? (Hint: Compare ROCE with ROA)

Please show all relevant work

Reference no: EM132664603

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