How to calculate Return on assets
The Return on assets formula, with plain worked examples you can check yourself.
Return on assets = NI ÷ A × 100
The result is a percentage (%).
Worked examples
NI = 140 · A = 700 · E = 350Return on assets = 20%
NI = 45 · A = 300 · E = 150Return on assets = 15%
NI = 70 · A = 700 · E = 350Return on assets = 10%
How to use it
- Write down the values for each letter in the formula.
- Do the brackets first, then divide or multiply.
- Multiply by 100 to show the answer as a percentage.
- Compare the answer with last period or with a competitor to see if it is good or bad.
This formula belongs to Investing & Returns.
Related terms
Practice Return on assets with real numbers
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