Question

Assume the Residential Division of Kipper Faucets had the following results last year Net sales revenue Operating income Average total assets Management's target rate of return What is the division's ROI? $ 18,700,000 7,480,000 5,500,000 18% A. 13696 B. 40% С. 74% D. 340%

Answer 1

Answer:

• What is the division's ROI?    

• A. 136%

Explanation:

The ROI (Return on Investment), it's a financial ratio that measure the benefit that an investor will receive in relation to their investment cost.

It's determined by the Operating Income / Average Total Assets =

$7,480,000 / $5,500,000 = 136%