Step Up Ladders Company provides the following financial information: $$\begin{array} { | l | r | }
\hline \text { Income from operations } & \$ 250,000 \
\hline \text { Interest expense } & 49,000 \
\hline \text { Gains/(losses) on sale of equipment } & 2800 \
\hline \text { Net income } & 198,200 \
\hline \text { Total assets at Jan. 1 } & 2,700,000 \
\hline \text { Total assets at Dec . 31 } & 3,500,000 \
\hline
\end{array}$$ Calculate return on investment based on the information given above.(Round your answer to two decimal places.)

Question

Step Up Ladders Company provides the following financial information: $$\begin{array} { | l | r | } 
\hline \text { Income from operations } & \$ 250,000 \
\hline \text { Interest expense } & 49,000 \
\hline \text { Gains/(losses) on sale of equipment } & 2800 \
\hline \text { Net income } & 198,200 \
\hline \text { Total assets at Jan. 1 } & 2,700,000 \
\hline \text { Total assets at Dec . 31 } & 3,500,000 \
\hline
\end{array}$$ Calculate return on investment based on the information given above.(Round your answer to two decimal places.)

Quizplus · Accepted Answer

Return on Investment (ROI) is calculated as Net Income divided by Average Total Assets. Average Total Assets = (2,700,000 + 3,500,000) / 2 = 3,100,000. ROI = 198,200 / 3,100,000 = 0.063935, or 6.39%.

Step Up Ladders Company Provides the Following Financial Information Calculate Return on Investment Based on the Information Given Above