Return on total assets measures:
A) The percent of net income in each dollar of net sales.
B) A company's ability to produce sales from their assets.
C) A company's ability to produce net income from their assets.
D) A company's ability to increase its asset base from sales.
E) A company's ability to increase its asset base from net incomE.

Question

Quizplus · Accepted Answer

Return on total assets (ROA) measures a company's ability to generate net income from their assets. It is calculated by dividing net income by total assets. This ratio indicates how efficiently a company is using its resources, and higher ROA values are generally considered more favorable.

Return on Total Assets Measures