Compare return-on-equity ratio for front beam lighting


Question:

Front Beam Lighting Company has the following ratios compared to its industry for 2010.


Front Beam Lighting
Industry
Return on assets 12%
5%
Return on equity
16%
20%

Explain why the return-on-equity ratio is so much less favorable than the return-on-assets ratio compared to the industry. No numbers are necessary; a one-sentence answer is all that is required.

Request for Solution File

Ask an Expert for Answer!!
Accounting Basics: Compare return-on-equity ratio for front beam lighting
Reference No:- TGS02097866

Expected delivery within 24 Hours