When Calculating Return on Net Operating Assets Analysts Sometimes Make

question 61

Essay

When calculating return on net operating assets analysts sometimes make adjustments to the net operating asset base used in the denominator or the ratio. Three possible adjustments are listed below. Explain what these adjustments are, and discuss the merits of these adjustments.

1. Non-operating asset adjustment
2. Intangible asset adjustment
3. Accumulated depreciation adjustment

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Definitions:

Baseballs

Hard balls used in the game of baseball, made of cork, rubber, and wrapped in leather, designed for hitting, pitching, and catching in the sport.

Hitting

Striking someone or something with force, often using hands, tools, or weapons, and can refer to physical actions in various sports and contexts.

Culture

The social behavior, norms, knowledge, and artifacts of a group of people, passed from one generation to another through communication and imitation.

Influence Learning

Refers to the process by which individuals alter their behavior, attitudes, or knowledge based on observed behaviors of others or by being in their presence, often linked to social or observational learning.