4 How is a company's return on investment calculated?Select one:a. By multiplying the margin by the turnover.b. By dividing the turnover by the average operatingassets.c. By dividing the margin by the turnover.ООd. By multiplying the turnover by the averageoperating assets.

Reference:Beattie, A. (2024, August 22). ROI: Return on Investment meaning and calculation Formulas.…

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Cornerstones of Financial Accounting

4th Edition

ISBN:9781337690881

Author:Jay Rich, Jeff Jones

Publisher:Jay Rich, Jeff Jones

Chapter12: Fainancial Statement Analysis

Section: Chapter Questions

Problem 28MCQ

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Which of the following is true? a. Return on Investment equals Margin divided by Average Operating Assets b. Turnover equals Sales divided by Stockholders Equity c. Margin equals Return on Investment divided by Turnover d. Return on Investment equals Margin divided by Turnover.
If your goal is to determine how effective a firm in managing its assets, you would examine O Profit margin, Current ratio, Debt ratio O Price-earnings ratio, Times-interest-earned ratio, Operating Margin O Inventory turnover, Receivables turnover, Assets turnover O Quick ratio, Debt ratio, Times-interest-earned ratio
In a DuPont analysis, what are the components of return on assets?a. Net Profit Margin Ratio and Debt Ratiob. Net Profit Margin Ratio and Leverage Ratioc. Net Profit Margin Ratio and Asset Turnover Ratiod. Asset Turnover Ratio and Leverage Ratio
Why is the operating return on assets ratio also referred to as the operating returnon investment?
The company’s profitability on each dollar invested in assets is represented by which of the following ratios: a. Profit margin. b. Asset turnover. c. Return on assets. d. Return on equity.
Discuss the following profitability ratios: Profit Margin, ROA-Return on Assets, ROI-Return on Investment, and the Gross Margin.
A. Which of the following is most closely associated with the cost of using assets? a. Asset utilization b. Sales revenue c. Proportion of debt and equity d. Average price B. Which of the following is most closely associated with the return on management’s use of assets? a. Cost of capital b. Mix of equity types c. Prime lending rate d. # of products sold
The return on total assets measures A. profitability by combining the effects of the profit margin and asset turnover. B.how efficiently a company uses its assets to generate sales. C.efficiency, profitability, and liquidity. D.liquidity.
Which of the following ratios is used to measure the profit earned on each dollar invested in a firm?a. return on sales ratio c. current ratiob. return on equity d. asset turnover ratio
Which of the following is the indicator of the rate at which company is earning profit? Select one: a. Margin of safety b. All options are correct c. Contribution margin d. Profit volume ratio
Question :- Can the financial health of a firm be based off of one ratio? Why or why not? How do you calculate Asset Turnover?
The investment turnover is the ratio of a. operating income to sales b. sales to invested assets c. operating income to invested assets d. assets to liabilities

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How is a company's return on investment calculated? Select one: a. By multiplying the margin by the turnover. b. By dividing the turnover by the average operating assets. c. By dividing the margin by the turnover. О О d. By multiplying the turnover by the average operating assets.