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How to calculate DuPont ROE

The DuPont ROE formula, with plain worked examples you can check yourself.

DuPont ROE = (NI ÷ R) × (R ÷ A) × (A ÷ E) × 100

The result is a percentage (%).

Worked examples

NI = 20 · R = 400 · A = 400 · E = 200DuPont ROE = 10%
NI = 40 · R = 800 · A = 400 · E = 200DuPont ROE = 20%
NI = 90 · R = 900 · A = 900 · E = 300DuPont ROE = 30%

How to use it

  1. Write down the values for each letter in the formula.
  2. Do the brackets first, then divide or multiply.
  3. Multiply by 100 to show the answer as a percentage.
  4. Compare the answer with last period or with a competitor to see if it is good or bad.

This formula belongs to Financial Statements.

Related terms

Balance sheetIncome statementAssetsLiabilitiesEquityCash flow statement

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