Segment Reporting, Profitability Analysis,
Turnover is computed by dividing average operating assets into:
a. invested capital.
b. total assets.
c. net operating income.
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
Which of the following is not an operating asset?
c. Plant equipment
d. Common stock
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.
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.
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.
All other things equal, a company's return on investment is
affected by a change in:
Net operating income is defined as:
a. sales minus variable expenses.
b. sales minus variable expenses and traceable fixed expenses.
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