Example: ABC Company have the following information for 2006, 2007 2006 2007 Cash 200000 250000 Inventory 100000 120000 A/R 25000 30000 150000 170000 15000 20000 1200000 Equipment's Accumulated depreciation Net sales Net operating income Cost of goods sold Operating expenses 50000 650000 90000 Required: Compute the ROI for 2007? ANS= 50000/1200000 x 1200000/522500 = 9.5%