The following information pertains to Diane Company. Assume that all balance sheet amounts represent both average and ending balance figures and that all sales were on credit. Use this information to answer the questions that follow.

-Using the data provided for Diane Company, what is the return on total assets?
A) 10%
B) 8%
C) 0.1%
D) 1%

Question

The following information pertains to Diane Company. Assume that all balance sheet amounts represent both average and ending balance figures and that all sales were on credit. Use this information to answer the questions that follow.
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-Using the data provided for Diane Company, what is the return on total assets?
A) 10% 
B) 8% 
C) 0.1% 
D) 1%

Quizplus · Accepted Answer

The return on total assets (ROTA) is calculated by dividing the net income by the total assets. Without specific numbers for Diane Company's net income or total assets, we cannot calculate an exact percentage. However, given the options, if the question implies that the correct answer is among them, A) 10% would be a plausible return on total assets in a general business context, assuming it was derived from the provided data.

The Following Information Pertains to Diane Company