Which of the following can increase a company's return on investment?
A) decrease in operating income
B) decrease in total assets
C) decrease in asset turnover ratio
D) decrease in residual income

Question

Quizplus · Accepted Answer

Return on investment (ROI) is calculated by dividing the operating income by total assets. Therefore, decreasing total assets while maintaining operating income would increase ROI. Choices A, C, and D would all decrease ROI.

Which of the Following Can Increase a Company's Return on Investment