Answer:
13.33%
Explanation:
Income from operations $400,000
Interest expense 47,000
Gains/(losses) on sale of equipment 3,000
Net income 350,000
Total assets at Jan. 1 2,600,000 Total assets at Dec .31 3,400,000
the formula used to calculate return on investment (ROI) is:
ROI = income from operations / average total assets
ROI = $400,000 / {($2,600,000 + $3,400,000) / 2} = $400,000 / $3,000,000 = 0.1333 or 13.33%
Return on investment measures the profitability of an investment during a period of time.
