The return on investment is calculated by:
A)Multiplying the capital turnover by the return on sales.
B)Dividing the capital turnover by the return on sales.
C)Dividing average invested capital by sales.
D)Multiplying operating income by capital turnover.

Question

Quizplus · Accepted Answer

Return on Investment (ROI) is calculated by multiplying the capital turnover (how efficiently a company uses its assets to generate sales) by the return on sales (also known as profit margin, which is the ratio of profit generated from sales). This combination reflects how effectively a company uses its capital to generate profits.

The Return on Investment Is Calculated By