Return on net assets

The return on net assets (RONA) is a measure of financial performance of a company which takes the use of assets into account. Higher RONA means that the company is using its assets and working capital efficiently and effectively.[1]

Basic formulae

Return on net assets = net income / (Fixed assets + working capital)
where Working capital = (current assets minus current liabilities)

In a manufacturing sector, this is also calculated as:
Return on net assets = (plant revenue - costs) / net assets

See also

References

  1. ↑ Return on Net Assets (RONA)
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