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7 March, 19:37

Given the following dа ta:

Average operating assets $504,000

Total liabilities $23,520

Sales $168,000

Contribution margin $85,680

Net operating income $45,360

Return on investment (ROI) would be:

A. 27.0%

B. 9.0%

C. 51.0%

D. 17.0%

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Answers (1)
  1. 7 March, 22:54
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    B. 9.0%

    Explanation:

    The Return on investment (ROI) of any entity/corporation/firm can be calculated using the following mentioned formula:

    ROI=Net operating income/cost of investment

    Assuming in this question

    Cost of investment = average operating assets=$504,000

    Net operating income=$45,360

    ROI=$45,360/$504,000=9%

    So based on the above discussion the answer is B. 9.0%
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