help-exam tomorrow - return on equity ratio

System
System Posts: 100,534 🤖 Admin 🤖
edited 10:27AM in AAT student discussion
can anyone help on this please<BR><BR>our college handbook states the ratio is profit after interest and preference dividends but before tax<BR>over ordinary share capital and reserves but past exam paper answers (dec 1999) gives the answer after tax, as does another past paper (can't remember what year)<BR>which is correct ?<BR>

Comments

  • System
    System Posts: 100,534 🤖 Admin 🤖
    help-exam tomorrow - return on equity ratio

    after tax makes more sense, as you are measuring what is due to equity shareholders who have to wait until everyone else has had their bit.
  • System
    System Posts: 100,534 🤖 Admin 🤖
    help-exam tomorrow - return on equity ratio

    Just thought I'd let you knoe the whole of our class gets confused on which profit figures to use for which ratios and our tutor has said as long as you write the formula out that you are using and it makes sense then you shouldn't lose any marks even if it doesn't completely agree what the assessor has.<BR>Good Luck!
  • System
    System Posts: 100,534 🤖 Admin 🤖
    help-exam tomorrow - return on equity ratio

    thankyou
  • System
    System Posts: 100,534 🤖 Admin 🤖
    help-exam tomorrow - return on equity ratio

    thanks and i'll need all the luck!
  • System
    System Posts: 100,534 🤖 Admin 🤖
    - return on equity ratio

    Hi,<BR><BR>Looks like you had a really good question yesterday.

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