Question

Return on Investment =

• A. $\left(\frac{\text{Gross Profit before Interest, Tax and Dividend}}{\text{Gross Sales}}\right)\times 100$
• B. $\left(\frac{\text{Net Profit before Interest, Tax and Dividend}}{\text{Capital employed}}\right)\times 100$
• C. $\left(\frac{\text{Net Profit}}{\text{Capital employed}}\right)\times 100$
• D. None of these

Answer 1

The correct option is B

$\left(\frac{\text{Net Profit before Interest, Tax and Dividend}}{\text{Capital employed}}\right)\times 100$

$ROI=\left(\frac{\text{Net Profit before Interest, Tax and Dividend}}{\text{Capital employed}}\right)\times 100$