what is mikes roi Mike Smith has the following financial data. Investment Assets at Year End $475,000 Investment Assets at Beginning of the Year $392,000 Savings Made During the Year by Mike $27,000 Employer Match to Mike's 401 (k) Plan $5,000 Total Assets on Ending Statement of Financial Position $700,000 Gross Income on Income Statement $100,000 Total Assets on Beginning Statement of Financial Position $600,000 Total Liabilities at Beginning of the Year $200,000 Total Liabilities at Year End $180,000

Question

Business

Katrina Taylor

20 March, 00:10

what is mikes roi Mike Smith has the following financial data. Investment Assets at Year End $475,000 Investment Assets at Beginning of the Year $392,000 Savings Made During the Year by Mike $27,000 Employer Match to Mike's 401 (k) Plan $5,000 Total Assets on Ending Statement of Financial Position $700,000 Gross Income on Income Statement $100,000 Total Assets on Beginning Statement of Financial Position $600,000 Total Liabilities at Beginning of the Year $200,000 Total Liabilities at Year End $180,000

+4

Answers (1)

Know the Answer?

Moshe Hood · Answer 1

Mike's return for the net worth of the year is 22.00%

Explanation:

Total Net Worth = Assets - Liabilities

In the start,

• Net Worth = 600,000 - 200,000 = 400,000

At end of year,

• Net Worth = 700,000 - 180,000 = 520,000

The Contribution made (During the year) = 27,000 + 5,000 = 32,000

Therefore,

Return on the Net Worth = (520,000 - 32,000) / 400,000 - 1 = 22.00%