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Return on investment (ROI) or return on costs (ROC) is the ratio between net income (over a period) and investment (costs resulting from an investment of some resources at a point in time). A high ROI means the investment's gains compare favorably to its cost.
Net return on investment = $50,000 selling price – $20,000 cost = $30,000 return ROI = $30,000 return / $20,000 cost x 100 = 150% The ROI on this antique car is 150%.
Return on Time Invested (ROTI) is a metric employed to assess the productivity and efficiency of time spent on a specific activity, project, or product. The concept is similar to return on investment (ROI), but instead of financial capital , ROTI measures the qualitative and quantitative outcomes derived from the time invested.
For the corporation, it is essentially internal rate of return (IRR). [2] CFROI is compared to a hurdle rate to determine if investment/product is performing adequately. The hurdle rate is the total cost of capital for the corporation calculated by a mix of cost of debt financing plus investors' expected return on equity investments.
Return on capital employed is an accounting ratio used in finance, valuation, and accounting. It is a useful measure for comparing the relative profitability of companies after taking into account the amount of capital used.
Any investment with a nominal annual return (i.e., unadjusted annual return) less than the annual inflation rate represents a loss of value in real terms, even when the nominal annual return is greater than 0%, and the purchasing power at the end of the period is less than the purchasing power at the beginning.
Capital budgeting in corporate finance, corporate planning and accounting is an area of capital management that concerns the planning process used to determine whether an organization's long term capital investments such as new machinery, replacement of machinery, new plants, new products, and research development projects are worth the funding of cash through the firm's capitalization ...
Return on marketing investment (ROMI), or marketing return on investment (MROI), is the contribution to profit attributable to marketing (net of marketing spending), divided by the marketing 'invested' or risked. ROMI is not like the other 'return-on-investment' (ROI) metrics because marketing is not the same kind of investment.