How Is Return on Investment (ROI)calculated

question 5

Multiple Choice

How is return on investment (ROI) calculated?

• A)operating income/average operating assets
• B)average operating assets/operating income
• C)operating income/sales
• D)sales/average operating assets

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Definitions:

Merchandise Inventory

Merchandise inventory refers to the products a company has available for sale to customers at any given time.

Note Payable

A written promise to pay a specific sum of money to a party on demand or at a predetermined future date.

Account Payable

The amount of money owed by a business to its suppliers or creditors for goods and services purchased on credit.

Notes Payable

Liabilities represented by written promises to pay specific sums of money at future dates, typically evidenced by formal instruments of credit.