ROI can be used in two ways.
(1) As a control technique to compare divisional performance within a company.
(2) As a planning decision technique to decide to accept or reject projects
ROI can be looked at in two ways:
ROI = Net profit / Net investment in assets
ROI = Net profit x Sales
Sales Net assets
ROI is not only a function of profitability but is also a result of asset utilisation
It is essential that when the ratio is used for comparison purposes that the same accounting rules and procedures are used to arrive at profit and capital employed.
Latest posts by BMS Team (see all)
- Meterdown Annual Festival is back with its 7th edition – Starts today! - January 16, 2020
- Tybms sem 6 results 2019 declared on 19th June 2019 - June 19, 2019
- TYBMS Sem 6 Results 2019 Update from BMS khabri! - June 15, 2019