Question

The Midwest Division of Grainger Company has investment center average invested assets of $200,000 and investment center income of $40,000. What is the return on investment for this division?

Answer 1

The return on investment for this division is (B) 20%.

What is the return on investment (ROI)?

• Return on investment (ROI) or return on costs (ROC) is a ratio of net income to investment over time (costs resulting from an investment of some resources at a point in time).
• A high ROI indicates that the benefits of the investment outweigh the costs.
• ROI is used as a performance indicator to evaluate the efficiency of an investment or to compare the efficiencies of several investments.
• It is one method of connecting profits to capital invested in economic terms.

To find the return on investment for this division:

= income/average invested assets

= $40,000/$200,000

= return on investment

= 20%

Therefore, the return on investment for this division is (B) 20%.

Know more about return on investment here:

brainly.com/question/15726451

#SPJ4

Correct question:

The Midwest Division of Grainger Company has an investment center average invested assets of $200,000 and an investment center income of $40,000. What is the return on investment for this division?

(A) 500%

(B) 20%

(C) 25%

(D) 80%