ROI = income ÷ invested capital
Expanded Return on Investment (ROI) Formula
ROI = income ÷ invested capital
ROI = (income ÷ sales) x (sales ÷ invested capital)
ROI = sales margin x investment turnover ratio
Amount of profit earned on every dollar invested.
Underlying reasons of Return on Investment (ROI) Equation
Profitability of Sales ---------- Profit/Sales Margin
Efficiency of Sales Generation --- Capital/Investment Turnover Ratio
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