Determine the cost of the project and the revenues from the project for the period management wishes to analyze. For example, a firm wants to start a new widget plant. The cost of the plant is $100,000. After 2 years, the firm estimates the project generated $150,000 in revenues.

Subtract the cost of the project from the gain from the project. In our example, $150,000 minus $100,000 equals $50,000.

Divide the number calculated in Step 2 by the cost of the project to determine ROI. In our example, $50,000 divided by $100,000 equals a ROI of 0.5.

Because this scenario project is (a not for profit) I am using the following costs below for my project analysis:

Determine the Cost of the Investment and Current Value of the Investment

$32,000$33,000

$33,000 - $32,000 =$1,000

($500 or $1,000)

Stuck at this point ($500 or $1,000) After 2 years, the firm estimates the project generated whether it should be $500 or $1,000 in revenues.

$500 $33,000

In My Example I have

Determine the cost of the project and the revenues from the project for the period management wishes to analyze. For example, a firm wants to start a new widget plant. The cost of the plant is $33,000.

I am stuck at this point--->After 2 years, the firm estimates the project generated should be $500 or $1,000 in revenues.

Subtract the cost of the project from the gain from the project. In the example, $1,000 minus $33,000 equals $32,000. Or In the example, $500 minus $33,000 equals =32,500

Divide the number calculated in Step 2 by the cost of the project to determine ROI. In the example, $1,000 divided by $33,000 or $500 divided by $33,000 equals a ROI of?

I must show and explain my work.

Not sure how to perform the detail ROI calculations.

I must determine is this a good use of your organization's resources why or why not.

Does the ROI support this? Why or why not? 

Answer rating: 100% (QA)

To calculate the return on investment ROI for the given project you need to determine the revenues g... View the full answer