Return on Shareholder’s Funds =
- $ \frac{Net\ Profit\ after\ interest\ and\ Tax}{Shareholder's\ Funds} + 100 $
- $ \frac{Net\ Profit\ after\ interest\ and\ Tax}{Shareholder's\ Funds} - 100 $
- $ \frac{Net\ Profit\ after\ interest\ and\ Tax}{Shareholder's\ Funds} \times 100 $
- $ \frac{Net\ Profit\ after\ interest\ and\ Tax}{Shareholder's\ Funds} \div 100 $
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Correct answer
Explanation
Correct Answer: $ \frac{Net\ Profit\ after\ interest\ and\ Tax}{Shareholder's\ Funds} \times 100 $
AI explanation
Return on Shareholders' Funds measures how much net profit (after interest and tax) a company generates relative to the equity shareholders have invested, expressed as a percentage — so the profit figure is divided by shareholders' funds and then multiplied by 100 to convert the ratio into a percentage. Adding, subtracting, or dividing by 100 instead of multiplying would not produce a meaningful percentage return figure.