ROE can be calculated with two variables.
1. Net earnings,
It can be calculated with the formula of
ROE = (Net Profit / Equity) x 100%. It is expressed in% in the figure found.
For example, the ROE value for a business with a net profit of $ 34,500 and a equity of $ 456,000;
ROE = $ 34,500 / $ 456,000 = 7.57%.