Question
Wolastoq Corp. reported the following ratios for 2021 and 2020: 2021 2020 Return on common shareholders equity 17.4 % 19.1 % Return on assets 10.8
Wolastoq Corp. reported the following ratios for 2021 and 2020:
| 2021 | 2020 | |||||
|---|---|---|---|---|---|---|
| Return on common shareholders equity | 17.4 | % | 19.1 | % | ||
| Return on assets | 10.8 | % | 9.2 | % | ||
| Debt to total assets | 38.0 | % | 52.0 | % | ||
| Profit margin | 9.8 | % | 6.1 | % | ||
| Asset turnover | 1.1 | times | 1.5 | times |
a) What changes in the ratios above may have increased or decreased the companys return on assets in 2021? b) What is the key reason driving the change in Wolastoqs return on common shareholders equity in 2021? Explain.
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Principles Of Accounting
Authors: Steven M. Bragg
1st Edition
1642210773, 978-1642210774
