Formula
to calculate return on assets:
Return
on Assets = net profit before taxes / total assets.
Return
on assets ratio definition and explanation:
The
return on assets
ratio provides a standard for evaluating how efficiently
financial management employs the average dollar invested
in the firm's assets, whether the dollar came from
investors or creditors.
A low
return on assets ratio indicates that the earnings are
low for the amount of assets.
The return
on assets
ratio measures how efficiently profits are being
generated from the assets employed.
A low
return on assets ratio compared to industry averages
indicates inefficient use of business assets.
The return on assets ratio is included in the RA-150
Expert financial statement ratio analysis spreadsheet,
which provides formulas, definitions, calculation,
charts and explanations of each ratio.
The return on assets ratio is listed in our profitability
ratios.
The return on assets ratio and other ratios are key
to understanding financial statements. Our
ratio calculation spreadsheets reduce time
and effort in calculating decision making
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Spreadsheets to
calculate ratios (includes formulas, definitions,
explanations and charts):
See list of
ratios our other spreadsheets calculate, define
and explain.
In addition to the financial
statement ratio analysis spreadsheets listed in the top
left chart, the return on assets ratio is
also included in out
CLA-15 Commercial Loan Officer spreadsheet which
provides the ratios, formulas and explanations for the
14 ratios used by Dunn and Bradstreet and the Altman
z-score bankruptcy predictor.
The return on assets ratio
may be included in our
custom 1, 3 or 5 period financial
statement ratio analysis spreadsheet.
Click here
to order excel
accounting spreadsheet to calculate 15 ratios with
formulas, definitions, calculations, charts, and
explanations for each ratio.
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calculator spreadsheet. Current, quick and
debt-to-equity ratios with formulas, calculations,
charts and explanations. Email
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