Calculate the return on assets managed (ROAM) of a branch whose total sales are $3,000,000, total assets are $1,500,000, gross margin is $500,000, and branch expenses are $200,000.
A. 
5.0% 

B. 
16.7% 

C. 
10.0% 

D. 
20.0% 
ROAM is a measure of profits as a result of the assets handled. It is calculated as below:
ROAM= Net Income/ Total Assets
Here, the Net Income is not given. It is calculated using Gross Margin as below,
We know that,
Gross Margin= Revenue  Cost of Goods Sold
500,000 = Revenue  3000,000
Revenue= $3,500,000
Therefore Net Income = Revenue Expenses
= $3,500,000  $200,000
= $3,300,000
.
Thus, ROAM = Net Income/ Total Assets * 100
= 3,300,000/ 1,500,000
= 20%
Thus, the correct answer is D. 20%
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