Question

Computing and Interpreting Return on Equity (ROE) Two music companies reported the following in their financial statements:
Required:
1. Compute the 2015 ROE for each company (express ROE as a percentage rounded to one decimal place). Which company appears to generate greater returns on stockholders’ equity in 2015?
2. Compute the 2015 P/E ratio for each company. Do investors appear to value one company’s earnings more than the other’s? Explain.


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  • CreatedNovember 02, 2015
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