What is the return on investment for a firm that has a debt ratio of 0.65, a net profit margin of 6.5%, sales of $740,000, and a total asset turnover of 4?
A) 26.0%
B) 16.9%
C) 6.5%
D) 4.6%

Question

Quizplus · Accepted Answer

The return on investment (ROI) can be calculated using the formula ROI = Net Profit Margin * Total Asset Turnover. Given a net profit margin of 6.5% and a total asset turnover of 4, the ROI is 6.5% * 4 = 26.0%.

What Is the Return on Investment for a Firm That