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Famous Bike Shops had $250,000 Net Profit and $1,000,000 in total assets last year. They...

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Accounting

Famous Bike Shops had $250,000 Net Profit and $1,000,000 in total assets last year. They have asked you to look at 3 potential investments and recommend which investment they should choose based on Bike Shops projected ROA (Return on Asset %).
Option 1- will increase Net Profit by 10% and will increase total Assets by $200,000
Option 2- has an ROA of 21%
Option 3- has an ROA of 28%
Which option has the best ROA and consequently is the option you recommend?
Hint: you will have to do 2 ROA calculations

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