Question

For the year 2015, systems corporation earned a net operating income of $2 million on sales of $6 million. assume that the company's average operating assets were $20 million. what is the company’s roi?

Answer 1

The solution would be like this:

Given: $20 million Asset
$2 million Income


$2,000,000 / $20,000,000

 

= 0.1
= 0.1 * 100%

= 10%

 

Therefore, Systems Corporation return of investment is 10%. To add, ROI is usually expressed as a percentage and is typically used for personal financial decisions, to compare a company's profitability or to compare the efficiency of different investments.