The return on assets ROA) model measures:
A) revenues divided by net profit times the asset turnover
B) net profit margin times the equity multiplier
C) net profit margin times asset turnover
D) net profit divided by total assets multiplied by the asset turnover

Question

Quizplus · Accepted Answer

The return on assets (ROA) model is calculated by multiplying the net profit margin by the asset turnover. This measures how efficiently a company is using its assets to generate profit.

The Return on Assets ROA) Model Measures