Asked by Jesus Gonzalez Jauregui on Jul 09, 2024
Verified
During Cummings most profitable year its net income was $25,000. What is the ROI if the investment was $50,000?
A) 63%.
B) 51%.
C) 50%.
D) 28%.
Gross Margin
The difference between sales revenue and the cost of goods sold, expressed as a percentage of sales revenue, indicating the financial health of a company's core activities.
Net Operating Income
The total profit of a company after operating expenses but before deducting interest and taxes.
- Absorb the concept of return on investment (ROI) along with the technique for its calculation.
Verified Answer
ZK
Zybrea KnightJul 15, 2024
Final Answer :
C
Explanation :
ROI (Return on Investment) is calculated by dividing the net income by the investment. For Cummings, with a net income of $25,000 and an investment of $50,000, the ROI is 25,00050,000=0.50 \frac{25,000}{50,000} = 0.50 50,00025,000=0.50 or 50%.
Learning Objectives
- Absorb the concept of return on investment (ROI) along with the technique for its calculation.