When calculating return on net operating assets it may be necessary to adjust assets to reflect the fact that not all assets are operating assets.

Question

Quizplus · Accepted Answer

Some assets may not be used directly in the company's operations and should not be included in the calculation of return on net operating assets. Examples include excess cash, investments unrelated to the company's operations, and assets held for sale. Adjusting for these assets can provide a more accurate measure of the company's operational efficiency.

When Calculating Return on Net Operating Assets It May Be