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AlphaTech Ltd reports fair market values as follows: Item Amount () Fair Market Value of Assets 1,000,000 Fair Market Value of Liabilities 400,000 Net Income

AlphaTech Ltd reports fair market values as follows:

Item

Amount (£)

Fair Market Value of Assets

1,000,000

Fair Market Value of Liabilities

400,000

Net Income

150,000

Requirements:

  1. Calculate the Return on Equity (ROE) using the fair market values.
  2. Create an income statement for AlphaTech Ltd for the year ended 31 December 2021.
  3. Explain how fair market values can influence investment decisions.

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