Return on investment is calculated by:
A) multiplying the profit margin by investment turnover.
B) multiplying total assets by the target rate of return.
C) dividing profit margin by investment turnover.
D) dividing sales by total assets.

Question

Quizplus · Accepted Answer

Return on investment (ROI) is calculated by multiplying the profit margin (net profit divided by sales) by the investment turnover (sales divided by total assets). This formula gives an indication of how well a company is using its assets to generate profits.

Return on Investment Is Calculated By