Conventional wisdom teaches us that a fool and his money are soon parted. How effective a firm is in generating 
gains from its total assets is an important indicator of efficiency. RoA gives an idea as to how efficient management is at using its assets to generate earnings. Calculated by dividing a company’s annual earnings by its total assets, RoA taken for arriving at the B&E Power 100 is an absolute value. If one were to interpret that ratio, it tells what earnings are generated from invested capital (assets). RoA for companies can vary substantially and will be highly dependent on the industry. The RoA figure gives investors an idea of how effectively the company is converting the money it has invested in assets into net income.
For complete IIPM article click here
Source:- IIPM Editorial
Visit also:- IIPM Publication, Business & Economy & Arindam Chaudhuri Initiative
gains from its total assets is an important indicator of efficiency. RoA gives an idea as to how efficient management is at using its assets to generate earnings. Calculated by dividing a company’s annual earnings by its total assets, RoA taken for arriving at the B&E Power 100 is an absolute value. If one were to interpret that ratio, it tells what earnings are generated from invested capital (assets). RoA for companies can vary substantially and will be highly dependent on the industry. The RoA figure gives investors an idea of how effectively the company is converting the money it has invested in assets into net income.For complete IIPM article click here
Source:- IIPM Editorial
Visit also:- IIPM Publication, Business & Economy & Arindam Chaudhuri Initiative
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