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Return on Net Assets (RONA) Defined

Investopedia defines Return on Net Assets and breaks down its components. Click link to watch the video.

KEY TAKEAWAYS

RONA compares a firm's net profits to its net assets to show how well it utilizes those assets to generate earnings.

A high ratio result demonstrates that management is maximizing the use of the company's assets.

Net income and fixed assets can be adjusted for unusual or non-recurring items to gain a normalized ratio result.

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