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# Return on Assets Calculator

If you want to determine the profit company is making from its assets, then this return on assets calculator is a tool you can use.

Returns on assets, also known as ROA, are a percentage ratio used to calculate the company's total profit earned from its assets.

According to the business administration, above 5% of ROA is typically considered good.

## Formula of Return on Assets Calculator

If you want to calculate the ROA instantly, you can use our return on assets calculator or find it manually; you can use the simple formula listed below:

ROA = (net profit / total assets) * 100%

Where,

Net profit = total amount of profit earned by the company after paying all expenses.

Note:

To find out net operating profit after tax, you can use our NOPAT Calculator.

### Why are ROA calculations necessary?

It is essential to calculate the return on assets of a company due to the factors listed below:

• ROA report helps to determine the company's efficiency.

• This ratio is typically used to compare the profit achievement earned by two different companies with similar assists.

• ROA is the most crucial factor counted by an investor; An investor will never invest its money in a company making fewer returns on the asset.

### Example

For more prices understanding, let us have an example below:

Suppose an ABC company is making a net profit of $3,100 from the total assets of$32,550. Calculate the returns on assets an ABC company is making.

Given data

Net profit = $3,100 Total assets =$32,550

To Find

Returns on assets = ?

Solution

To calculate ROA, let's use the formula below:

ROA = (net profit / total assets) * 100%

Putting values in the formula:

ROA = (3,100 / 32,550) * 100% = 9.538%

### How to use the Return on Assets Calculator?

The steps to use the return on assets calculator are as follows:

Step 1: Enter net income in the first required input.

Step 2: Enter total assets in the second required input.

Step 3: The calculator will automatically display an answer on the screen.

### Calculator use

To find ROE instantly, enter the required values in our free and online Returns on assets calculator, and it will display the answer on the screen.