Which of the Following Statements Is Correct

question 33

Multiple Choice

Which of the following statements is correct?

• A)Selling inventory at its cost does not affect the net profit margin ratio.
• B)Accruing sales revenue does not affect the net profit margin ratio.
• C)The total asset turnover ratio increases when fixed assets are sold at a loss.
• D)The net profit margin ratio decreases when common stock is issued.

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Definitions:

Forward-Looking

A term used to describe actions or policies designed with consideration of future consequences and outcomes.

Larger Bequest

Pertains to a greater amount of money or property left to someone in a will, highlighting the concept in inheritance and estate planning.

Marginal Tax-Rate

The rate at which the next dollar of taxable income is taxed.

Substitution Effect

The change in consumption that results when a price change moves the consumer along a given indifference curve to a point with a new marginal rate of substitution.