Alani's Hawaiian segment had revenues of $2,075 million, operating income of $1,500 million, and average assets of $1,450 million. The Hawaiian segment return on assets is:
A) 138.3%
B) 69.9%
C) 96.7%
D) 72.3%
E) 103.4%

Question

Quizplus · Accepted Answer

Return on assets (ROA) is calculated as operating income divided by average total assets.

ROA = Operating income / Average total assets

Substituting the given values: 
ROA = $1,500 million / $1,450 million 
ROA = 1.0344 or 103.44%

The Hawaiian segment return on assets is 103.4%, which is closest to option E.

Alani's Hawaiian Segment Had Revenues of $2,075 Million, Operating Income