Introduction:
Return on Assets: Return on assets is the ratio of profit of the business in relation to the total assets of the company. In other words, return on assets also represents the efficient usage of resources or assets by the management in generating revenues.
Return on assets is computed as the ratio of its net income to the total assets of the company over a given period of time. The investors largely depends on this financial ratio of return on assets for making investment decisions. The percentage of 5% or more is considered as good ratio of return on assets in general.
Requirement-1:
To determine:
The return on assets for each segment of the Teton Company based on operating income and segment average assets.
Requirement-1b:
To identify:
The segment with the highest and lowest return of assets of Teton Company for the year 2015.
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