Current Attempt in ProgressThe return on total assets measures4O profitability by combining the effects of the profit margin and asset turnover.O efficiency, profitability, and liquidity.O how efficiently a company uses its assets to generate sales.O liquidity.Save for LaterAttem

Return on total assets -One measurement of profitability that shows how well a company manages its…

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FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Similar questions

The analysis of a firm's liquidity includes all of the following except Multiple Choice Current ratio. Receivables turnover. Inventory turnover. Fixed asset turnover.
What is the operating cash flow? The capital spending? The change is net working capital? The cash flow from asset?
1. Which of the following is referred to as the Accounting Equation? Assets Liabilities + Equity Equity Liabilities + Assets Liabilities Assets + Equity Assets = Liabilities - Equity = 2. Which of the following make up the Finance Equation? (select all that apply) Revenues = Price x Volume Costs = Fixed + Variable Profit Revenues-Costs Income Sales - COGS
In what way are profitability and efficiency related? How are profitability and liquidity related?
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
What are some tools that companies have to manage their (net operating) working capital? Provide examples of inventory and receivables management techniques. What is the Cash Conversion Cycle and why is this a useful metric? Are there risks if this is too low?
_______ ratios are used to measure the speed in which various assets are converted into sales or cash. A Debt (aka Leverage) B Efficiency (aka working capital) C Profitability C Coverage
The invested capital employed turnover rate would include Profit in the denominator Sales in the numerator Profits in the numerator Sales in the denominator
Which of the following scenarios can increase the return on assets? a. Increase the current and quick ratio b. Increase the profit margin, other things equal c. Other things equal, increase the amount of assets used d. Other thing equal, decrease the turnover of assets
The ratio sales to working capital is a measure ofa. Collectability.b. Operational leverage.c. Liquidity.d. Financial Leverage
g. operating profit margin h. long -term debt ratio i. total debt ratio
Interpret the results: • Return on equity • Return on assets • Gross profit margin • Operating profit margin • Net profit margin

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The return on total assets measures profitability by combining the effects of the profit margin and asset turnover. O efficiency, profitability, and liquidity. O how efficiently a company uses its assets to generate sales. O liquidity.