Return on assets: Return on total assets can be defined as the ratio that measures a company's net income against its total net assets or average total assets. Rate of Return on total assets can be calculated as − Return on Total Assets = Net Income Average Total assets Now, the average total assets are calculated as − Average total assets = Beginning Total assets + Ending total assets 2

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Chapter 1, Problem 16QS

To determine

Concept Introduction:

Return on assets:

Return on total assets can be defined as the ratio that measures a company's net income against its total net assets or average total assets.

Rate of Return on total assets can be calculated as −

Return on Total Assets= Net IncomeAverage Total assets

Now, the average total assets are calculated as −

Average total assets=Beginning Total assets+Ending total assets2

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