10.23%
return on total assets of River corp who's total assets at the end of last year were $390,000 and its net income was $32,750 was 10.23%
<h3>What was the return on total assets?</h3>
This can be found by the formula:
= Net income / Total assets x 100%
This then on substitution gives:
= 32,750 / 320,000 x 100%
= 10.23%
Hence, the return was 10.23%.
<h3>What is return on total assets?</h3>
The ratio of a company's profits before interest and taxes (EBIT) to its total net assets is called return on total assets (ROTA).
<h3>What is meant by return on asset?</h3>
- The return on assets (ROA), sometimes known as the return on total assets, is a metric for gauging how much money a company makes off of its capital.
- This profitability ratio illustrates the rate of growth in profits produced by an organization's assets.
<h3>What Makes a Strong ROA? </h3>
- Typically, a ROA of 5% or above is seen as good; a ROA of 20% or higher is regarded as great.
- In general, a corporation is more effective at making profits if its ROA is higher.
- However, the ROA of any one company must be viewed in the context of its rivals in the same sector and industry.
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