Finance and Business
Return on Equity Calculator
Return on Equity Calculator calculate return on average equity and a three-step DuPont decomposition from income, assets, revenue, and equity balances.
Finance and Business
Return on Equity Calculator
Calculate return on average equity and a three-step DuPont decomposition from income, assets, revenue, and equity balances.
Formula
ROE = net income / average equity; DuPont ROE = net margin x asset turnover x equity multiplier.
About the Return on Equity Calculator
Calculate return on average equity and a three-step DuPont decomposition from income, assets, revenue, and equity balances.
How the Return on Equity Calculator Works
Beginning and ending balances are averaged, direct ROE is calculated, and revenue and average assets decompose the same return into profitability, efficiency, and leverage.
Formula
ROE = net income / average equity; DuPont ROE = net margin x asset turnover x equity multiplier.
The calculation runs in your browser. Values are validated for required ranges, compatible units, and method-specific restrictions before results are displayed.
Required Inputs
- Net income (required).
- Revenue (required).
- Beginning total assets (required).
- Ending total assets (required).
- Beginning equity (required).
- Ending equity (required).
Results Reported
The result panel reports the final answer and the intermediate quantities needed to check the calculation:
- Return on average equity (%)
- Average equity (currency)
- Net profit margin (%)
- Asset turnover (x)
- Equity multiplier (x)
- DuPont-calculated ROE (%)
Return on Equity Calculator Example
Select Example Data in the calculator to load this reproducible input set:
| Input | Example value |
|---|---|
| Net income | 120000 |
| Revenue | 1000000 |
| Beginning total assets | 1400000 |
| Ending total assets | 1600000 |
| Beginning equity | 700000 |
| Ending equity | 800000 |
How to Use the Calculator
- Confirm that the calculator title and formula match the quantity you need.
- Enter every required value using the unit shown with its field.
- Select Example Data to inspect a valid input set, or enter your own values and select Calculate.
- Review all reported values and the displayed formula before using the answer.
- Use Copy Result or Download CSV when you need a reusable record.
Accuracy and Limitations
Negative or very small equity can make ROE misleading. Use consistent periods and account for buybacks, one-time income, accounting changes, and financial-company balance sheets.
Keep units consistent, use measurements that represent the actual situation, retain full precision during the calculation, and round only the final answer. Professional decisions may require current official rules, field measurements, laboratory methods, or specialist review.
Frequently Asked Questions
What does the Return on Equity Calculator calculate?
Calculate return on average equity and a three-step DuPont decomposition from income, assets, revenue, and equity balances.
Which formula does the Return on Equity Calculator use?
ROE = net income / average equity; DuPont ROE = net margin x asset turnover x equity multiplier. Beginning and ending balances are averaged, direct ROE is calculated, and revenue and average assets decompose the same return into profitability, efficiency, and leverage.
What should I check before using the Return on Equity Calculator result?
Negative or very small equity can make ROE misleading. Use consistent periods and account for buybacks, one-time income, accounting changes, and financial-company balance sheets.