Return on total assets - The ratio of earnings available to common stockholders to total assets.
A measure of how good a company is at "squeezing" earnings out of the assets employed in its business, which is calculated as follows:Return on assets = (profit before interest and tax) / (fixed assets + current assets)If you are using this ratio to evaluate a company, you need to consider what kind of business the company is in. "People" businesses, such as advertising agencies, need very few capital assets compared with a manufacturer which typically needs to invest large amounts in plant and equipment.In general, a return of 12% is adequate and a return of 16% or more is considered good.
Return on total assets : the ratio of earnings available to common stockholders to total assets.
a measure of how good a company is at "squeezing" earnings out of the assets employed in its business, which is calculated as follows:return on assets = (profit before interest and tax) / (fixed assets + current assets)if you are using this ratio to evaluate a company, you need to consider what kind of business the company is in. "people" businesses, such as advertising agencies, need very few capital assets compared with a manufacturer which typically needs to invest large amounts in plant and equipment.in general, a return of 12% is adequate and a return of 16% or more is considered good.
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