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6 January, 08:00

Two investment centers at Marshman Corporation have the following current-year income and asset dа ta:

Investment Center A Investment Center B

Investment center income $540,000 $650,000

Investment center average invested assets $4,900,000 $3,200,000

The return on investment (ROI) for Investment Center A is:

A. 828.30%

B. 29.10%

C. 11.02%

D. 49.20

E. 24.10

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Answers (2)
  1. 6 January, 10:37
    0
    11.02%

    Explanation:

    ROI=Net profit on investment/total investment engaged = $540,000/$4,900,000=11.02%

    As the invested assets are $4,900,000 and amount earned on such assets is $540,000, therefore we can easily worked out returned earned on investment center A.
  2. 6 January, 11:57
    0
    Option C is correct

    ROI = 11.02%

    Explanation:

    Return on Investment is the proportion of operating assets that an investment centre earned as as net operating income.

    It is calculated as follows

    ROI = operating income/operating assets

    ROI for Investment centre A

    = (540,000/4,900,00) * 100

    = 11.02%
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