Total assets are calculated by adding the values of all current and non-current assets on a company’s balance sheet. Assets are categorized into two broad types: current and non-current.
The formula for working capital is: Working Capital = Current Assets - Current Liabilities Current assets are those that a company reasonably expects to convert into cash within one year.
You'll be looking for total assets and total liabilities, both current and non-current ... In this case, the formula for equity-to-assets in this case would be $4 million divided by $5 million ...
While they're most definitely both considered part of the asset category, current assets and plant assets don't share all that much in common. Current assets are expected to be used within a year ...
Using the formula, return on equity would equal 0.18 or 18% ... if you’re interested in whether a company has enough assets to pay off short-term liabilities. Say a company has $1 million in current ...