The denominator in the formula for return on investment calculation is
A) investment center controllable margin.
B) dependent on the specific type of profit center.
C) investment center average operating assets.
D) sales for the period.

Question

Quizplus · Accepted Answer

The denominator in the ROI formula is the investment center average operating assets. This includes all assets directly controlled by the investment center, such as property, equipment, and inventory. Therefore, the answer is C.

The Denominator in the Formula for Return on Investment Calculation