The formula for calculating ROI is
A)Segment margin divided by average operating assets.
B)Segment margin divided by internal rate of return.
C)Internal rate of return divided by average operating assets.
D)None of these answer choices are correct.

Question

Quizplus · Accepted Answer

ROI (return on investment) is calculated by dividing the segment margin by the average operating assets. This is a widely accepted formula for measuring the profitability and effectiveness of investments made by a business or organization. Option B is incorrect as internal rate of return is a measure of the profitability of an investment based on the time value of money, not a measure of ROI. Option C is incorrect as it combines two different measures of profitability/return and does not provide an accurate measure of ROI. Option D is incorrect as there is a correct answer for the formula for calculating ROI.

The Formula for Calculating ROI Is