Calculate the Return on Equity (ROE)for Malti International Limited manufacturing pre mix for instant shakes and smoothies from the details given below
- ● Investment- Rs. 10,00,000/-
- ● Borrowed Funds- Rs.6,00,000/-
- ● Interest rate per annum is 10%.
- ● Monthly sales revenue is Rs. 6,00,000/- and Cost of goods sold is
- Rs.3,00,000/-.
- ● Fixed expenses per month Rs. 2,00,000/- (salary Rs.1,50,000/-, rent
- and utility Rs.50,000/-)
- ● Depreciation Rs.10,000/-
- ● Tax @ 20%.
If Malti international Limited wishes to know how their own money is being used, which parameter for performance evaluation, ROE or ROI, should be used?
