ROA is the product of
A)net income margin and turnover.
B)book value and turnover.
C)leverage and book value.
D)net income margin and leverage.

Question

Quizplus · Accepted Answer

Return on assets (ROA) is calculated by dividing net income by total assets. Net income margin is the ratio of net income to revenue, while turnover is the ratio of revenue to total assets. Therefore, ROA is the product (or multiplication) of net income margin and turnover.

ROA Is the Product of