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Accounting 2302 Chapter 12 Segment Reporting, Profitability Analysis, and Decentralization Multiple Choice 18. D Easy Turnover is computed by dividing average operating assets into: a. invested capital. b. total assets. c. net operating income. d. sales. 20. A Medium In computing the margin in a ROI analysis, which of the following is used? a. Sales in the denominator b. Net operating income in the denominator c. Average operating assets in the denominator d. Residual income in the denominator 21. D Easy Which of the following is not an operating asset? a. Cash b. Inventory c. Plant equipment d. Common stock 22. C Medium CPA adapted Assuming that sales and net income remain the same, a company's return on investment will: a. increase if operating assets increase. b. decrease if operating assets decrease. c. decrease if turnover decreases. d. decrease if turnover increases. 23. C Medium CPA adapted All other things equal, a company's return on investment (ROI) would generally increase when: a. average operating assets increase. b. sales decrease. c. operating expenses decrease. d. operating expenses increase. 24. B Easy A company's return on investment is the: a. margin divided by turnover. b. margin multiplied by turnover. c. turnover divided by average operating assets. d. turnover multiplied by average operating assets. 1 25. A Easy All other things equal, a company's return on investment is affected by a change in: Turnover Margin a. Yes Yes b. No Yes c. No No d. Yes No 26. D Medium Net operating income is defined as: a. sales minus variable expenses.... View Full Document

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