Parsa Inc. reported the following results from last year's operations: At the beginning of this year, the company has a $1,100,000 investment opportunity with the following characteristics:
Last year's return on investment (ROI) was closest to:
A) 10.0%
B) 5.0%
C) 50.0%
D) 64.3%

Question

Parsa Inc. reported the following results from last year's operations:  At the beginning of this year, the company has a $1,100,000 investment opportunity with the following characteristics:
 Last year's return on investment (ROI) was closest to:
A) 10.0% 
B) 5.0% 
C) 50.0% 
D) 64.3%

Quizplus · Accepted Answer

ROI = Net operating income ÷ Average operating assets = $700,000 ÷ $7,000,000 = 10.0%

Parsa Inc Reported the Following Results from Last Year's Operations