Enter the net earnings ($) and the total equity ($) into the Return on Earnings Calculator. The calculator will evaluate and display the Return on Earnings. 

Return on Earnings Formula

The following formula is used to calculate the Return on Earnings. 

ROEA = NE / TE * 100

  • Where ROEA is the Return on Earnings (%)
  • NE is the net earnings ($) 
  • TE is the total equity ($) 

How to Calculate Return on Earnings?

The following example problems outline how to calculate Return on Earnings.

Example Problem #1:

  1. First, determine the net earnings ($). 
    • The net earnings ($) is given as: 57,000.
  2. Next, determine the total equity ($). 
    • The total equity ($) is provided as: 300,000.
  3. Finally, calculate the Return on Earnings using the equation above: 

ROEA = NE / TE * 100

The values given above are inserted into the equation below and the solution is calculated:

ROEA = 57,000 / 300,000 * 100 = 19.00 (%)


Example Problem #2: 

For this problem, the variables needed are provided below:

net earnings ($) = 5,000

total equity ($) = 82,000

This example problem is a test of your knowledge on the subject. Use the calculator above to check your answer. 

ROEA = NE / TE * 100 = ?