• Return on investment (ROI) quantifies how much money or profit is made on investment as a percentage of the investment’s expense.
• Return on investment (ROI) shows how successfully and proficiently investment dollars are utilized to create profits.
Return on investment (ROI) is an accounting term that shows the level of invested money that is recovered in the wake of deducting related costs. For the non-bookkeeper, this may sound confusing; however the recipe might be essentially expressed as follows:
ROI = (Gain-cost)/cost
where gain = investment gain & cost = Investment cost.
This equation appears to be simple enough to ascertain. Nonetheless, a number of variables become possibly the most important factor, including fix and maintenance costs, just as influence the measure of money acquired (with premium) to make the initial investment. These variables can influence the ROI numbers.