If margin = 5 percent, net income = $100,000, and turnover = 4.0, then Blank______.Multiple choice question.ROI = 20%, average total assets = $500,000, and sales = $2,000,000ROI = 20%, average total assets = $1,000,000, and sales = $4,000,000ROI = 10%, average total assets = $500,000, and sales = $4,000,000ROI = 15%, average total assets = $500,000, and sales = $5,000,000
Question
If margin = 5 percent, net income = 100,000, and turnover = 4.0, then Blank______.Multiple choice question.ROI = 20%, average total assets = 500,000, and sales = 1,000,000, and sales = 500,000, and sales = 500,000, and sales = $5,000,000
Solution
The formula for ROI (Return on Investment) is:
ROI = (Net Income / Total Assets) * 100%
We know that Net Income = $100,000.
We also know that Margin = Net Income / Sales. So, we can rearrange this to find Sales = Net Income / Margin = 2,000,000.
Turnover is defined as Sales / Total Assets. We can rearrange this to find Total Assets = Sales / Turnover = 500,000.
Now we can calculate ROI = (500,000) * 100% = 20%.
So, the correct answer is: ROI = 20%, average total assets = 2,000,000.
Similar Questions
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