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Updated over 6 years ago on . Most recent reply
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Explanation of Net Income ROI
I was looking at a pro forma and it read Net Income ROI which I am unfamiliar with. The pro forma also has Cash ROI and Total ROI which I am familiar with. I haven't been able to figure out what Net Income ROI is, or at least numbers I have tried to plug in have made completely different results than what was listed on the pro forma. Is the equation Net Income ROI = Net Income after Taxes/ Down Payment? As reference:
Net Income ROI was listed as Year 1: 13.9% Year 2: 21.5% and Year 5: 34.0%
Cash ROI Year 1: 22.9% Year 2: 30.0% and Year 5: 39.3%
Total ROI Year 1 30.5% Year 2: 38.0% and Year 5: 49.8%
Thanks in advance for explanations.