Answer-The 'Return on Investment (ROI)' ratio is calculated as:

Q: Answer-The 'Return on Investment (ROI)' ratio is calculated as:

Return on Investment ROI or Return on Capital Employed ROCE is a profitability ratio that measures the efficiency with which a company uses its capital to generate profits. It is commonly calculated as Earnings Before Interest and Tax EBIT Capital Employed 100.

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The 'Return on Investment (ROI)' ratio is calculated as:

Question

The 'Return on Investment (ROI)' ratio is calculated

as:

A (Net Profit / Sales) * 100 Correct Answer Incorrect Answer

B (Net Profit / Total Assets) * 100 Correct Answer Incorrect Answer

C (Net Profit / Shareholders' Equity) * 100 Correct Answer Incorrect Answer

D (Operating Profit / Capital Employed) * 100 Correct Answer Incorrect Answer

Solution

Return on Investment (ROI) or Return on Capital Employed (ROCE) is a profitability ratio that measures the efficiency with which a company uses its capital to generate profits. It is commonly calculated as (Earnings Before Interest and Tax (EBIT) / Capital Employed) * 100.

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