Chapter 14, Problem 14.5.3C
Survey of Accounting (Accounting I)
Solutions
Survey of Accounting (Accounting I)
Concept Introduction:
Return on investment (ROI):
Return on investment is a profitability ratio that represents the percentage return on the investment made. It is calculated by dividing the Net Income by the Average total assets. The formulas to calculate the ROI are as follows:
Or
To Calculate:
The estimated return on investment for the new product line
The estimated return on investment for the new product line is calculated as follows:
| Operating Income (A) | $ 810,000 |
Chapter 14 Solutions
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