Question

Tom's Tool Factory is an investment center and is responsible for all of its net income and the use of its assets. This year, the invested assets totaled $475,000, and net income was $275,000. What is the return on investment

Answer 1

Answer:

57.9 %

Explanation:

Return on investment (ROI) is a financial ratio. It is used to measure the expected returns from in relation to the cost of investment.

The formula for calculating ROI is Net Income / Cost of Investment.

For tom tools factory, the ROI will be

net income $275,000

cost of investmet is $475,000

ROI = 275,000/ 475,000

RO1 = 0.5789473 X 100

=0.5789473

=57.894 OR

=57.9 %