When computing the return on total assets, the interest expense is added back to net income to show what earnings would have been if the company had no debt.

Return on Total Assets

A financial ratio that measures the profitability of a company in relation to its total assets, indicating how efficient management is at using its assets to generate earnings.

Interest Expense

A financial charge for borrowing money or the cost incurred on debt.

Net Income

The total profit of a company after all expenses and taxes have been subtracted from total revenue.