Emiley Inc. ,newly incorporated on January 2,earned $100,000 in net operating income in its first year of operations which ended December 31.Operating assets,which increased evenly throughout the year,totalled $200,000 at year end.ROI for the year was?

Question

Quizplus · Accepted Answer

ROI (Return on Investment) is calculated by dividing net operating income by average operating assets.

Average operating assets = (Beginning operating assets + Ending operating assets) / 2 
= ($0 + $200,000) / 2 
= $100,000

ROI = Net operating income / Average operating assets 
= $100,000 / $100,000 
= 1 or 100%

Therefore, the correct answer is choice C) 100%.