Determining missing items in return on investment computation One item is omitted from each of the following computations of the return on investment: Return on Investment = Profit Margin x Investment Turnover 24 % = 10 % x (a) (b) = 24 % x 0.75 12 % = (c) x 1.5 16 % = 20 % x (d) (e) = 15 % x 2.2

Determining missing items in return on investment computation One item is omitted from each of the following computations of the return on investment: Return on Investment = Profit Margin x Investment Turnover 24 % = 10 % x (a) (b) = 24 % x 0.75 12 % = (c) x 1.5 16 % = 20 % x (d) (e) = 15 % x 2.2

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Question

Determining missing items in return on investment computation

One item is omitted from each of the following computations of the return on investment:

Return on Investment	=	Profit Margin	x	Investment Turnover
24 %		=	10 %		x	(a)
(b)		=	24 %		x	0.75
12 %		=	(c)		x	1.5
16 %		=	20 %		x	(d)
(e)		=	15 %		x	2.2

Formula Formula ROI (%) = Net Income Principal Amount × 100

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