The return on investment of a company can be improved by either increasing average total assets or decreasing operating income.

Question

Quizplus · Accepted Answer

The return on investment (ROI) of a company is calculated by dividing its operating income by its average total assets. Therefore, to improve ROI, a company would need to increase its operating income while keeping its average total assets stable or decrease its average total assets while keeping its operating income stable. Decreasing operating income will decrease the ROI.

The Return on Investment of a Company Can Be Improved