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  • Nov 4, 2009, 04:12 PM
    susan1sars
    Return on Investment
    If revenue is 950,000, net income is 575,000 and the average assets are 495,000, what is the return on the investment?
  • Nov 4, 2009, 05:49 PM
    decisionsupport

    If the net income number you provided is after taxes and considering the fact that revenue is included in your information, you would use the DuPont formula.

    your ROI will then basically be,

    ((Net Income / Revenue) x (Revenue / Average Total Assets)) * 100

    (575,000 / 950,000) x (950,000 / 495,000) =
    (.60526)x(1.91919) = 1.1616

    1.1616 x 100 = 116%

    Vital Knowledge
  • Jun 25, 2012, 02:51 PM
    decisionsupport
    I moved my blog if anyone is interested in following up.. eFinancialAnalysis

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