Return on Assets Calculator

Return on assets measures a company's ability to use its assets to create profits.

Definition Return on assets equals net income divided by average total assets.
Net income is the profit of the business after tax.
Average assets is total of beginning and ending assets divided by two.
Return on Assets Calculator
Net income after tax $
Total assets at the beginning of the year $
Total assets at the end of the year $
Return on assets

Working with your return on assets

Return on assets is a common measure, but is based on historical values of assets. For example, fixed assets after accumulated depreciation goes into the calculation, but the book value of a factory may be considerably less than its current market value. Another issue is that return on assets is usually based only on a one year snapshot.

By monitoring changes in your return on assets over time, you can better understand the financial dynamics of your business, identify trends and run the business more effectively. Here is a worksheet you can use to track changes in this and other important measures.