Robichau Inc. reported the following results from last year's operations:
At the beginning of this year, the company has a $900,000 investment opportunity with the following characteristics:
The company's minimum required rate of return is 20%.
-Last year's return on investment (ROI)was closest to:
A) 47.6%
B) 18.9%
C) 9.0%
D) 45.7%

Question

Robichau Inc. reported the following results from last year's operations:
  At the beginning of this year, the company has a $900,000 investment opportunity with the following characteristics:
  The company's minimum required rate of return is 20%.
-Last year's return on investment (ROI)was closest to:
A) 47.6% 
B) 18.9% 
C) 9.0% 
D) 45.7%

Quizplus · Accepted Answer

ROI = Net operating income ÷ Average operating assets = $567,000 ÷ $3,000,000 = 18.9%