What does "return on assets" mean?
Our return on assets (ROA) calculator uses a business’ net profit to work out the return of a business in the form of a percentage. It is generally expressed a percentage of increase or decrease in the value of an asset which could be the business you intend to purchase. Return on assets is a basic but important analytical tool that is commonly used by business owners and investors.
How do you calculate return on assets?
If a business is selling price of $200,000 and the net profit was $50,000 for the past year.
Use this formula to work out return on assets:
ROA = (net annual profit / asset price) x 100
ROA = (50 000/200 000) x 100
In this case, your ROA is 25%.
Return On Asset Calculator (ROA)
Calculator Disclaimer
The results from this tool should be used as an indication only and does not constitution financial advice. Always seek professional advice prior to purchasing a business or making a serious business decision.
