The return on investments calculation considers only the following components: Sales Average Investment Net income Which of the following formulas best describes the return on investment calculation? 1. (Net Income / Sales) X (Sales / Net Income) 2. (Net Income / Sales) X (Salės / Average Investment) 3. (Average Investment / Sales) X (Net Income / Sales) 4. (Sales / Average Investment) X (Sales / Net Income)

The return on investments calculation considers only the following components: Sales Average Investment Net income Which of the following formulas best describes the return on investment calculation? 1. (Net Income / Sales) X (Sales / Net Income) 2. (Net Income / Sales) X (Salės / Average Investment) 3. (Average Investment / Sales) X (Net Income / Sales) 4. (Sales / Average Investment) X (Sales / Net Income)

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Similar questions

Match the ratio to the building block of financial statement analysis to which it best relates.A. Liquidity and efficiency B. Solvency C. Profitability D. Market prospects Times interest earned
Q: Choose all that apply: The following ratios may be impacted by the adoption of the new standard: A. Revenue growth B. Net margin C. Return on equity D. Price to earnings multiples E. Return on assets F. Debt to equity G. Current ratio The Question is: Why "Debt to equity" and "Current ratios" may be impacted?
Q . Which of the following statements is not true?a) The return on shareholders’ funds can be calculated as profit after tax /total equity x 100b) The dividend cover ratio can be calculated from the Income statement andthe statement of cash flows and the answer will be the samec) The interest cover ratio can be calculated from the income statement andthe statement of cash flows and the answer will be differentd) The operating profit margin is also called the net profit margin
In terms of future value (FV) which of the following considerations is correct? Select one: O A. Consider only future cash flows as relevant factors O B. Consider only past cash flows as relevant factors O C. Consider past sales revenues and cost of sales as relevant factors O D. Consider future gross profit and net profits as relevant factors
Does this solution work with the formula below?AFN = [((Total Assets/Sales)(∆Sales))-((Current Liabilities/Sales)(∆Sales))] - (Earnings After Tax - Dividends)
Which type of average rate of return best describes the average annual rate of return earned over the period (the arithmetic or geometric)? Why?
The profitability index is another method to evaluate capital investments. If you are trying to compare investments of different sizes, why is the profitability index a better way to do this when compared to the net present value method?
explain the impact on financial statement using FIFO, weighted avverage and LIFO. When would the three methods give similar profit figures? when would they give indentical profit figure?
4. There is a difference in return on Total Assets and the return on Total Equity. a. What is the difference between the two? b. Which ratio of the two is normally higher?
Is this a right formula? Forward P/E = Market capitalization/ forecasted income
The two main approaches to equity analysis are the relative valuation models and…a. The discounted earnings models.b. The depreciated cash-flow models.c. The discounted cash-flow models.d. The depreciated capital models.
The present value of an investment's future cash flows divided by its initial cost is the: O Net present value. O Internal rate of return. O Average accounting return. O Profitability index. O Payback period.