Asked by Attila Szalay on Jul 20, 2024
Verified
The return on investment (ROI) last year for the Hum Division was:
A) 75%
B) 25%
C) 35%
D) 12%
Return On Investment
Return on investment (ROI) is a financial metric used to evaluate the efficiency of an investment, calculated as the net profit divided by the cost of the investment.
ROI
Return on Investment is a performance measure used to evaluate the efficiency or profitability of an investment relative to its cost.
- Work out the return on investment (ROI) and realize its consequences.
Verified Answer
CM
Chloe MarieJul 25, 2024
Final Answer :
B
Explanation :
ROI = Net operating income ÷ Average operating assets
= $150,000 ÷ $600,000 = 25%
Reference: CH10-Ref18
The West Division of Cecchetti Corporation had average operating assets of $240,000 and net operating income of $42,200 in August.The minimum required rate of return for performance evaluation purposes is 19%.
= $150,000 ÷ $600,000 = 25%
Reference: CH10-Ref18
The West Division of Cecchetti Corporation had average operating assets of $240,000 and net operating income of $42,200 in August.The minimum required rate of return for performance evaluation purposes is 19%.
Learning Objectives
- Work out the return on investment (ROI) and realize its consequences.