A return on assets of 5.15% means that a company is earning:
A) a $5.15 return on every $100 of total assets.
B) a $5.15 return on every $100 of assets minus liabilities.
C) a $5.15 return on every $100 of current assets.
D) a $5.15 return on every $100 invested in long-term assets.

Question

Quizplus · Accepted Answer

Return on assets is calculated by dividing net income by total assets. Therefore, a return on assets of 5.15% means that the company is earning $5.15 for every $100 of total assets.

A Return on Assets of 5