Hey guys,
This is a question from the independent trial paper 2012 for business.
Balance sheet given:
Owners equity 2012
Capital $165,000
Net Profit $95,000
2011 return on owner's equity 5.3%
Q: Outline one possible reason for the change in owners equity between 2011 and 2012
What I wrote was that it increased from 5.3% in 2011 to 36.54% in 2012... but the answers says that it decreased to 1.2% in 2012
Am I calculating this wrong or something?.. my school used some of the independent paper and they marked my answer right? Is my school teaching it wrong? (I also stated why it increased but the main thing im concerned about is how did they get 1.2%?)
What i did was NP/OE x 100
So... 95/(165+95) x 100 = 36.54
This is a question from the independent trial paper 2012 for business.
Balance sheet given:
Owners equity 2012
Capital $165,000
Net Profit $95,000
2011 return on owner's equity 5.3%
Q: Outline one possible reason for the change in owners equity between 2011 and 2012
What I wrote was that it increased from 5.3% in 2011 to 36.54% in 2012... but the answers says that it decreased to 1.2% in 2012
Am I calculating this wrong or something?.. my school used some of the independent paper and they marked my answer right? Is my school teaching it wrong? (I also stated why it increased but the main thing im concerned about is how did they get 1.2%?)
What i did was NP/OE x 100
So... 95/(165+95) x 100 = 36.54
I just placed it in the formula!